Exam 11: Distribution Customer Service and Logistics

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Most marketing functions can be shared in a channel, but the storing function is almost always handled by the producer.

(True/False)
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Retailers selling a new product that is in hot demand-like the latest DVD release or a best selling book-would be unlikely to incur higher costs for faster delivery.

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Which of the following statements about physical distribution is False?

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The right physical distribution system should be based primarily on

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Good marketing strategy planners know that:

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Higher physical distribution service levels is not a source of differentiation.

(True/False)
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There are big shifts in demand from season to season for the lawn mowers produced by GreenVision Co.-and its need for storage facilities also varies. GreenVision should think about using:

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Transporting cost as a percentage of selling price is lowest for:

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Regarding transporting by truck:

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Terry Harter is marketing manager for United Tools and Mike O'Reilly is the firm's logistics manager. They work together to make decisions about how to get United's hand and power tools to its customers-a mix of manufacturing plants and final consumers (who buy United tools at a hardware store). United Tools does not own its own transport facilities and it works with wholesalers to reach its business customers. Together, Harter and O'Reilly try to coordinate transporting, storing, and product handling activities to minimize cost while still achieving the customer service level their customers and intermediaries want. This usually requires that United keep an inventory of most of its products on hand, but demand for its products is fairly consistent over time so inventory is easy to manage. Harter has identified four options for physical distribution systems she could use to reach two of her key wholesalers, Ralston Supply and Ricotta Tool Co. The total cost for each option-and the distribution service levels that can be achieved-are as follows: Ralston Supply expects a very high level (90 percent) of distribution customer service. Ricotta Tool Co. is willing to settle for a 70 percent customer service level, even if that means some products will occasionally be out of stock, if it gets products at a lower price. For its large retail hardware customers (like Home Depot), United regularly ships smaller orders directly to individual stores or in some cases to the retail chain's warehouses. Cross-country shipments usually go by rail while regional shipments usually go by truck. United ships to the regional distribution centers of one of the retail hardware chains that it serves. The main advantage of the distribution centers for the retailer is likely to be that they Terry Harter is marketing manager for United Tools and Mike O'Reilly is the firm's logistics manager. They work together to make decisions about how to get United's hand and power tools to its customers-a mix of manufacturing plants and final consumers (who buy United tools at a hardware store). United Tools does not own its own transport facilities and it works with wholesalers to reach its business customers. Together, Harter and O'Reilly try to coordinate transporting, storing, and product handling activities to minimize cost while still achieving the customer service level their customers and intermediaries want. This usually requires that United keep an inventory of most of its products on hand, but demand for its products is fairly consistent over time so inventory is easy to manage. Harter has identified four options for physical distribution systems she could use to reach two of her key wholesalers, Ralston Supply and Ricotta Tool Co. The total cost for each option-and the distribution service levels that can be achieved-are as follows: Ralston Supply expects a very high level (90 percent) of distribution customer service. Ricotta Tool Co. is willing to settle for a 70 percent customer service level, even if that means some products will occasionally be out of stock, if it gets products at a lower price. For its large retail hardware customers (like Home Depot), United regularly ships smaller orders directly to individual stores or in some cases to the retail chain's warehouses. Cross-country shipments usually go by rail while regional shipments usually go by truck. United ships to the regional distribution centers of one of the retail hardware chains that it serves. The main advantage of the distribution centers for the retailer is likely to be that they

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Which of the following is NOT true about the supply chain for Ford Motor Company?

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Regarding railroads,

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Which of the following does NOT contribute to total inventory cost?

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Transporting choices in developing countries are usually fewer in number, but cost more.

(True/False)
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The physical distribution concept says (or implies) that:

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About what percentage of the cost of hospital supplies in the U.S. are a result of logistics?

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The challenges of coordinating logistics functions in a supply chain has led to less sharing of information over the Internet and at websites.

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Shipping by air

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Inventory refers to

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After evaluating all of its alternatives and the costs of each, Vegpro Kenya decided the most efficient way to quickly get its fresh vegetables from Nairobi to European cities was to use air freight. What approach did it use in making this decision?

(Multiple Choice)
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