Deck 13: Marketing Channels and Logistics Networks

Question 1

The process of moving products from the factory to resellers and ultimately to the customer is known as:

A) outbound distribution.
B) a conventional marketing channel.
C) inbound distribtion.
D) the value delivery network.
E) none of the above

Answer 1

A

Question 2

If a channel member is able to coordinate successive states of production and distribution because of the size and power of the firm doing the coordinating, it is using a(n):

A) contractual vertical marketing system.
B) multichannel marketing system.
C) horizontal marketing system.
D) administered vertical marketing system.
E) corporate vertical marketing system.

Answer 2

D

Question 3

Producers of convenience goods typically seek distribution.

A) exclusive
B) intensive
C) inclusive
D) restrictive
E) selective

Answer 3

B

Question 4

Select the word that best completes the following sentence. A major trend in distribution is _ in which producers either cut out intermediaries and go directly to final buyers or seek out new types of channel intermediaries.

A) disintermediation
B) hybrid distribution systems
C) direct distribution
D) exclusive distribution
E) reintermediation

Question 5

Wholesalers organise a group of independent retailers to help them compete more effectively with large retail chains in a:

A) retailer cooperative.
B) wholesale- retail chain.
C) wholesaler- sponsored voluntary chain.
D) wholesale cooperative.
E) wholesaler- owned chain.

Question 6

Each layer of intermediaries that perform some work in bringing the product closer to the final buyer is identified by a channel:

A) layer.
B) relationship.
C) configuration.
D) level.
E) structure.

Question 7

from the manufacturer or service provider is the set of firms that supply the raw materials, components, parts, information, finances and expertise needed to create a product or service.

A) Upstream
B) Congruous
C) Downstream
D) Separated
E) none of the above

Question 8

Premier department store, David Jones, terminated its arrangements with Country Road for the supply of clothing after Country Road became increasingly involved with discounting at Country Road stores and also distributing via Direct Factory Outlets (DFOs). David Jones believed that Country Road's distribution activities were not only a direct source of direct competition, but were also inconsistent with David Jones' carefully crafted image as a prestige brand. This is an example of:

A) a power struggle.
B) selective distribution.
C) exclusive dealing.
D) channel conflict.
E) none of the above

Question 9

Remo Corporation is experiencing conflicts between the various levels which compose its channel of distribution. This is called:

A) functional conflict.
B) vertical conflict.
C) intermediary conflict.
D) member conflict.
E) horizontal conflict.

Question 10

Intermediaries play an important role in matching:

A) supply and demand.
B) dealer with customer.
C) product to region.
D) A and B
E) none of the above

Question 11

Piaget Watches has a restrictive policy of only establishing one or two dealers within a given large geographic area. Buyers of this type of expensive Swiss watch will travel to acquire the product, so this form of distribution is appropriate for the product.

A) selective
B) intensive
C) intermediary
D) exclusive
E) dual

Question 12

Which of the following statements BEST defines marketing logistics?

A) Overseeing the flow of materials and products.
B) The process of getting goods to customers.
C) All the activities involved in the selling of goods and services directly to final customers.
D) The planning, implementing and controlling the physical flows of materials and final goods from points of origin to points of use.
E) Getting the right goods to the right places at the right time.

Question 13

Transporting and storing goods is part of which of the following marketing channel functions?

A) negotiation
B) risk taking
C) contact
D) matching
E) physical distribution

Question 14

Which of the following are the three main types of vertical marketing system?

A) administered, independent and franchised
B) corporate, franchised and independent
C) corporate, contractual and administered
D) corporate, contractual and chain
E) corporate, contractual and intermediate

Question 15

Modern Homes sells a range of home improvement products such as blinds, curtains and solar panels. Modern deals directly with the consumer through its web- site and 1800 numbers advertised on television. Modern Homes' distribution system consist of how many levels?

A) one level
B) two levels
C) zero levels
D) three levels
E) None of the above-it is not appropriate to use channel levels in direct distribution.

Question 16

Which of the following is NOT one of the types of franchise?

A) wholesaler- sponsored franchise network
B) manufacturer- sponsored retailer franchise network
C) service- firm- sponsored franchise network
D) manufacturer- sponsored wholesaler franchise network

Question 17

In a(n) , two or more unrelated companies put together resources or programmes to exploit an emerging marketing opportunity.

A) administered VMN
B) corporate VMN
C) horizontal marketing system
D) multichannel marketing system
E) contractual VMN

Question 18

For which of the following would a manufacturer be most likely to use selective distribution?

A) designer baby clothes
B) milk
C) cat food
D) plastic measuring spoons
E) $10 bird feeders

Question 19

Systems in which retailers organise a new, jointly- owned business to carry on wholesaling and, possibly, production activities are known as:

A) manufacturer- owned chains.
B) franchised distribution channels.
C) retail cooperatives.
D) wholesaler- sponsored voluntary chains.
E) distribution cooperatives.

Question 20

The Ance Corporation's wholesalers openly attempt to "steal" the better accounts from one another. The resulting friction is best described as:

A) vertical conflict.
B) horizontal conflict.
C) specialised conflict.
D) account conflict.
E) member conflict.

Question 21

If speed is a concern, the two best modes of transporting goods are:

A) pipeline and water.
B) rail and truck.
C) water and air.
D) air and truck.
E) water and rail.

Question 22

Independent producers, wholesalers and retailers constitute a(n):

A) direct marketing system.
B) independent marketing system.
C) horizontal marketing system.
D) vertical marketing system.
E) conventional marketing system.

Question 23

Phillipa's Bakery has earned a reputation for its hand- made breads and pastries. To protect the "artisan" image that her products have developed, Phillipa does not want to sell her products in multinational supermarkets. Instead, she sells direct through her four bakery outlets in Melbourne and suburbs. In addition, Phillipa sells her breads and pastries via carefully chosen farmer's markets and a few small, independent supermarkets. Phillipa's distribution strategy is BEST described as which of the following?

A) exclusive
B) mass
C) concentrated
D) intensive
E) selective

Question 24

When a company's internal departments work together and cooperate with marketing channel members to provide better customer service and trim distribution costs, this is known as:

A) distribution management.
B) channel planning.
C) marketing channel management.
D) integrated logistics management.
E) none of the above

Question 25

Channel objectives should be:

A) written with the strengths and weaknesses of intermediaries in mind.
B) stated in terms of which channels will be used.
C) designed to be impervious to temporary changes in the external environment.
D) uniform across product lines.
E) all of the above

Question 26

Sears obtains more than 50 per cent of its goods from companies that it partly or wholly owns. This would be an example of a(n):

A) administered VMN/VMS.
B) global VMN/VMS.
C) corporate VMN/VMS.
D) power based VMN/VMS.
E) contractual VMN/VMS.

Question 27

Select the word that best completes the following sentence. Historically, have lacked the power and leadership to manage channel conflict.

A) contractual marketing systems
B) corporate vertical marketing systems
C) manufacturer sponsored marketing systems
D) retailer sponsored marketing systems
E) conventional marketing systems

Question 28

When Evans Toys for Boys agreed not to carry any other brand of motorcycle EXCEPT Kawasaki, it was an example of a(n):

A) exclusive distribution arrangement.
B) tying contract.
C) reciprocal agreement.
D) vertical buying agreement.
E) horizontal buying agreement.

Question 29

If Pizza Hut franchisees complain that other Pizza Hut franchisees are cheating on ingredients, giving poor service, and are hurting the overall Pizza Hut image, these complaints are indicative of a:

A) system conflict.
B) horizontal conflict.
C) parallel conflict.
D) conventional conflict.
E) vertical conflict.

Question 30

Most shopping goods manufacturers, such as those selling televisions, furniture and appliances, probably utilise:

A) concentrated distribution.
B) exclusive distribution.
C) intense distribution.
D) selective distribution.
E) intensive distribution.

Question 31

Finished goods stored as a buffer against future demand or warehoused in between production and intermediaries is termed:

A) containers.
B) inventory.
C) cargo.
D) pallets.
E) none of the above

Question 32

In marketing terms, we say that the number of intermediary levels indicates the _ of a channel.

A) complexity
B) length
C) depth
D) involvement
E) width

Question 33

When a producer has a conflict with its wholesalers, the producer is experiencing conflict.

A) vertical channel
B) direct channel
C) single channel
D) horizontal channel
E) multichannel

Question 34

Managing the entire value added flows of materials and products both upstream and downstream is known as:

A) channel management.
B) supply chain management.
C) logistics.
D) value delivery network management.
E) none of the above

Question 35

What are the three gaps that separate goods and services from those who would use them?

A) place, time, need
B) place, possession, form
C) place, need, distribution
D) time, place, form
E) time, place, possession

Question 36

The Rocky Corporation has developed a distribution system composed of intermediaries which Rocky either owns or has under contract. Rocky has established a:

A) horizontal marketing system.
B) proprietary marketing system.
C) vertical marketing system.
D) wholly- owned marketing system.
E) homogeneous marketing system.

Question 37

The task performed by channel members concerned with grading, assembling and packaging is:

A) promotion.
B) prospecting.
C) negotiation.
D) matching.
E) contact.

Question 38

One of the following is NOT a key function that intermediaries play in completing transactions. Choose it.

A) information
B) financing
C) promotion
D) negotiation
E) pricing

Question 39

Logistics is a matter of:

A) trade- offs between cost areas such as transport versus production lot quantity costs.
B) ensuring that least cost physical distribution is achieved.
C) reducing the number of warehouses companies use.
D) making increased sales and then transporting them at optimal costs.
E) all of the above

Question 40

By definition, a(n) centre receives goods from various company plants and suppliers and moves them out as soon as possible.

A) field
B) distribution
C) storage
D) common
E) automated

Question 41

Conflict between channel members at different levels in the channel is called simply:

A) functional conflict.
B) vertical conflict.
C) intermediary conflict.
D) horizontal conflict.
E) member conflict.

Question 42

Packaged peanuts are sold in grocery stores, service stations, convenience stores, drugstores, discount stores, and vending machines. This is an example of distribution strategy.

A) selective
B) exclusive
C) horizontal
D) intensive
E) franchising

Question 43

Bega manufactures cheese products. These products are sold in large quantity to independent wholesalers who subsequently repackage and subsequently sell them to independent retail outlets most of which are supermarkets or convenience stores. Bega is using:

A) mass market distribution system.
B) manufacturer- sponsored voluntary chain.
C) conventional marketing channels.
D) vertical marketing network.
E) voluntary marketing network.

Question 44

Producers benefit from using intermediaries because they:

A) are generally backlogged with orders.
B) refuse to store products for longer than a couple of days.
C) operate less expensively.
D) save a lot of work.
E) offer greater efficiency in making goods available to target markets.

Question 45

A channel of distribution with no intermediaries is called a(n):

A) direct marketing channel.
B) unconventional marketing channel.
C) indirect marketing channel.
D) conventional marketing channel.
E) direct retail channel.

Question 46

Lancome, makes and markets a range of cosmetics and skincare products which are sold through department stores and pharmacies. Before a retailer is permitted to stock the Lancome brand, the retailer's staff must undergo appropriate product and sales training with Lancome's Head Office. In this way, Lancome exerts some control over the quality of retail outlets stocking its product and also minimises potential channel conflict by ensuring the pharmacies permitted to stock their brand are spread over a wide geographic area. Lancome is using which type of distribution?

A) intensive
B) mass
C) concentrated
D) selective
E) exclusive

Question 47

Select the words that best complete the following sentence. One of the biggest recent channel developments has been the rise of marketing networks to replace _ marketing channels.

A) vertical; horizontal
B) horizontal; vertical
C) vertical; transient
D) vertical; conventional
E) contractual; vertical

Question 48

An independent firm whose sales forces handles products on behalf of many companies operating in different countries or different industries is known as:

A) manufacturer's agent.
B) retailer's agent.
C) distributor.
D) wholesaler.
E) none of the above

Question 49

When a single firm sets up two or more marketing channels to reach one or more customer segments the result is:

A) multi- level marketing.
B) symbiotic marketing.
C) megamarketing.
D) horizontal marketing.
E) multichannel networks.

Question 50

The Perth Copier Company is trying to decide on whether to use a company sales force or agents to reach its West Coast market. Establishing a sales office would cost $180,000. Salespeople would be paid $25,000 plus a 5 per cent commission. Each salesperson could handle about $1,000,000 in sales a year. Agents would be paid a flat 12 per cent commission on all sales. The Perth Copier Company is using criteria to evaluate their major channel alternatives.

A) economic
B) qualitative
C) adaptive
D) control
E) territorial

Question 51

Melbourne Marine retains outright ownership of all members of its distribution channel. Melbourne Marine's channel would be best described as a(n):

A) administrative VMN.
B) proprietary VMN.
C) consolidated VMN.
D) contractual VMN.
E) corporate VMN.

Question 52

Southern Pacific Tyres sells tyres as original equipment to automobile manufacturers. The firm also sells to the "replacement" market through independent and company- owned stores. Southern Pacific Tyres is utilising:

A) competitive marketing.
B) multi- level marketing.
C) symbiotic marketing.
D) horizontal marketing.
E) multichannel network.

Question 53

Marketing channel members perform a number of functions. Which of the following is NOT one of the functions outlined in your text?

A) Risk reduction
B) Risk taking
C) Negotiation
D) Information
E) All of the above are channel member functions.

Question 54

The combines successive stages of production and distribution under single ownership.

A) horizontal marketing system
B) conventional marketing system
C) multichannel marketing system
D) contractual vertical marketing system
E) corporate vertical marketing system

Question 55

Disagreements among channel members regarding roles and goals generate:

A) greater cooperation.
B) an increase in channel length.
C) improved communication.
D) healthy competition which improves channel efficiency.
E) channel conflict.

Question 56

Rolls Royce, sells its luxury motor vehicles direct from the factory in Reading, England or through one of its accredited dealers. Rolls Royce uses which of the following distribution formats?

A) open distribution
B) exclusive distribution
C) selective distribution
D) intensive distribution
E) special distribution

Question 57

H&R Block and Hyatt Legal Services have formed a(n) in which Hyatt houses its legal clinics in H&R Block tax- preparation offices. Hyatt pays a fee for office space, secretarial assistance, and office equipment. By working out of H&R Block's nationwide offices, Hyatt gains quick market penetration. In turn, H&R Block benefits from renting its facilities, which have a highly seasonal use pattern.

A) horizontal marketing system
B) administered VMN
C) contractual VMN
D) multichannel marketing system
E) corporate VMN

Question 58

Bright Preserves, a producer of a line of all- natural condiments, is trying to choose between using its own sales force or hiring manufacturers' representatives to sell its products. Bright Preserves has come to the realisation that it can more easily direct its sales force's efforts, the products emphasised, and how accounts are managed if it sets up its own sales force. This company is evaluating its choice on the basis of _ criteria.

A) control
B) quantitative
C) economic
D) territorial
E) adaptive

Question 59

Once channel objectives have been established, the next step in channel design is to:

A) evaluate the major channel alternatives.
B) determine service output levels.
C) select the channel members.
D) identify the major channel alternatives.
E) set up contingency plans in the event of environmental changes.

Question 60

Select the word that best completes the following sentence. A conventional marketing system consists of _ producers, wholesalers and retailers.

A) hybrid
B) product- related
C) independent
D) franchised
E) administered

Question 61

Leadership in the channel is attained through the size and power of one of the channel members in a(n):

A) proprietary VMN.
B) administered VMN.
C) corporate VMN.
D) consolidated VMN.
E) contractual VMN.

Question 62

All of the following are considered to be forms of a vertical marketing network/system (VMN/VMS) EXCEPT:

A) global.
B) corporate.
C) contractual.
D) administered.
E) none of the above

Question 63

Which of the following is NOT one of the trends in distribution management discussed in your text?

A) distermediation
B) growth of multichannel marketing
C) growth in vertical marketing systems
D) growth of direct- response marketing
E) growth in horizontal marketing systems

Question 64

Firms which utilise more than one intermediary, but fewer than all of the intermediaries that could potentially carry their products, are said to employ:

A) exclusive distribution.
B) intensive distribution.
C) concentrated distribution.
D) selective distribution.
E) none of the above

Question 65

A type of contractual VMN in which the channel member is linked in to the production- distribution process is the:

A) consumer buying group.
B) service entity.
C) wholesaler group.
D) retailer group.
E) franchise organisation.

Question 66

Franchise operations, such as Kwik Copy Printing, Domino's Pizza, and Hertz Car Rentals, are examples of:

A) contractual VMNs.
B) conventional marketing systems.
C) horizontal marketing systems.
D) administered VMNs.
E) corporate VMNs.

Question 67

Reaching an agreement on price and other terms of the offer so that ownership or possession can be transferred is associated with which of the following key functions performed by the marketing channel?

A) negotiation
B) contact
C) selling
D) information
E) matching

Question 68

Select the word that best completes the following sentence. A(n) marketing channel consist of independent producers, wholesalers and retailers.

A) horizontal
B) vertical
C) lateral
D) conventional
E) independent

Question 69

The process of moving products from suppliers to the factory is known as:

A) reverse distribution.
B) value supply chain.
C) inbound distribution.
D) outbound distribution.
E) none of the above

Question 70

Conflict between channel members at the same level of the channel is called simply:

A) oblique conflict.
B) horizontal conflict.
C) functional conflict.
D) vertical conflict.
E) intermediary conflict.

Question 71

Coordination and conflict management is attained through single ownership at different levels of the channel in a(n):

A) corporate VMN.
B) administered VMN.
C) proprietary VMN.
D) conventional VMN.
E) contractual VMN.

Question 72

Which of the following is NOT a type of franchise?

A) service- firm- sponsored retailer franchise system
B) manufacturer- sponsored retailer franchise system
C) manufacturer- sponsored wholesaler franchise system
D) retail- wholesaler- sponsored retail- wholesale franchise system
E) All of the above are franchises.

Question 73

IBM, at one time sold its products using its own sales force exclusively. Today, however, the market has prompted changes in IBM's distribution philosophy. The company now has 18 new channels in addition to its own sales force. The correct description of this form of marketing would be to characterise IBM's approach as being one where are used.

A) horizontal marketing systems
B) diversified marketing systems
C) vertical marketing systems
D) hybrid marketing systems
E) parallel marketing systems

Question 74

When a company like Coca- Cola has disagreements with some of its bottlers over business practices, it is a form of:

A) parallel conflict.
B) layer- based conflict.
C) vertical conflict.
D) horizontal conflict.
E) system conflict.

Question 75

Coordination and conflict management is achieved through the use of written, legally- binding agreements among independent channel members in a(n):

A) consolidated VMN.
B) corporate VMN.
C) proprietary VMN.
D) contractual VMN.
E) administrative VMN.

Question 76

Avon, Amway and Tupperware use which of the following forms of channel distribution?

A) indirect marketing channel
B) forward channel
C) direct marketing channel
D) fashion channel
E) intermediary channel

Question 77

The process of moving broken, unwanted, excess or products returned by customers to resellers or distributors is known as:

A) outbound distribution.
B) inverse distribution.
C) reverse distribution.
D) inbound distribution.
E) none of the above

Question 78

When Coca- Cola and Nestlé formed a joint venture to market ready- to- drink coffee and tea worldwide, the type of marketing system that was formed would be best described as being a:

A) vertical marketing system.
B) horizontal marketing system.
C) hybrid marketing system.
D) parallel marketing system.
E) diversified marketing system.

Question 79

The task performed by channel members that involves finding and communicating with prospective buyers is:

A) contact.
B) promotion.
C) negotiation.
D) matching.
E) prospecting.

Question 80

Two or more unrelated companies at one channel level join together to pursue a new marketing opportunity in:

A) partnership marketing.
B) horizontal marketing.
C) vertical marketing.
D) homogeneous marketing.
E) an administered VMN.