Exam 11: Distribution Customer Service and Logistics
Exam 1: Marketings Value to Consumers, Firms, and Society396 Questions
Exam 2: Marketing Strategy Planning319 Questions
Exam 3: Evaluating Opportunities in the Changing Marketing Environment358 Questions
Exam 4: Focusing Marketing Strategy With Segmentation and Positioning283 Questions
Exam 5: Final Consumers and Their Buying Behavior353 Questions
Exam 6: Business and Organizational Customers and Their Buying Behavior264 Questions
Exam 7: Improving Decisions With Marketing Information257 Questions
Exam 8: Elements of Product Planning for Goods and Services379 Questions
Exam 9: Product Management and New-Product Development251 Questions
Exam 10: Place and Development of Channel Systems288 Questions
Exam 11: Distribution Customer Service and Logistics214 Questions
Exam 12: Retailers, Wholesalers, and Their Strategy Planning392 Questions
Exam 13: Promotionintroduction to Integrated Marketing Communications344 Questions
Exam 14: Personal Selling and Customer Service293 Questions
Exam 15: Advertising, Publicity, and Sales Promotion331 Questions
Exam 16: Pricing Objectives and Policies292 Questions
Exam 17: Price Setting in the Business World278 Questions
Exam 18: Implementing and Controlling Marketing Plans: Evolution and Revolution150 Questions
Exam 19: Managing Marketings Link With Other Functional Areas237 Questions
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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.
When United Tools considers its total inventory cost, which of the following would NOT be included?


(Multiple Choice)
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Maintaining the right level of inventory is easy now that there are tools to precisely forecast and model demand.
(True/False)
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Using airfreight instead of some other mode of transporting may result in:
(Multiple Choice)
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Which of the following statements concerning physical distribution trade-offs is NOT true?
(Multiple Choice)
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The total cost approach involves evaluating each possible PD system and identifying all the transportation costs associated with each alternative.
(True/False)
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Transporting costs usually add relatively little to the cost of valuable products.
(True/False)
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A supply chain includes all the activities involved in procuring materials, transforming them into products, and distributing them to customers.
(True/False)
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Bar codes, UPC numbers, and RFID tags make it easy for computers to monitor inventory, order stock, and track shipping costs.
(True/False)
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Which of the following statements about the transporting function is TRUE?
(Multiple Choice)
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More freight is carried more miles _____ than any other mode of transportation.
(Multiple Choice)
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When planning physical distribution, the marketing manager should:
(Multiple Choice)
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A "supply chain" is the same thing as a "channel of distribution."
(True/False)
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The best way to ship a heavy product like iron ore from St. Louis, Missouri, to New Orleans, Louisiana, in the Spring season with no arrival deadline is to use:
(Multiple Choice)
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As a percentage of GDP, which of the following most likely characterizes logistic costs incurred in developing economies in Africa?
(Multiple Choice)
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With the PD concept, firms decide what specific service level to provide their customers.
(True/False)
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