Deck 13: Marketing Channels

Question 1

Integrated channel relationships tend to be more flexible than cooperative relationships.

Answer 1

False
Cooperative relationships tend to be more flexible than integrated relationships but are more structured than arm's-length relationships.

Question 2

A marketing channel is a set of interdependent organizations that ease the transfer of ownership as products move from producer to business user or consumer.

Answer 2

True

Question 3

Tammy Bowles makes handmade,wooden children's toys,which she sells online to end users.Tammy does not use channel intermediaries,which means she uses a direct channel.

Answer 3

True

Question 4

As products move through the marketing channel,channel members provide specialization and division of labor,overcome discrepancies,and provide contact efficiency.

Question 5

Reciprocal conflict occurs among channel members on the same level,such as two or more different wholesalers or two or more different retailers that handle the same manufacturer's brands.

Question 6

The Beistle Company manufactures Halloween decorations year-round,but customer demand is concentrated only during the month of October.By maintaining inventories of the Beistle Company's products,marketing channels overcome this spatial discrepancy.

Question 7

Highly integrated channel relationships are the preferred relationship because there is no large outlay of assets required to keep the channel members all working toward the same results.

Question 8

An international consumer products manufacturer requires all of its suppliers to provide the lowest possible cost and to adhere to a just-in-time inventory system.Wholesalers and manufacturers generally yield to the authority of this large manufacturer.This consumer products manufacturer exercises channel power.

Question 9

Carl represents a manufacturer of floor coverings and gets paid a commission for finding buyers and linking them up with the manufacturer.Carl is an example of a merchant wholesaler.

Question 10

LoneStar Bar & Grill is a small chain of restaurants that feature marinated steaks.The marinade is so popular that LoneStar sells it at its restaurants and Kroger supermarkets.This is an example of intensive distribution.

Question 11

A consumer stopped by the convenience store to buy a bag of charcoal briquettes.She only needs one bag,but the manufacturer produces millions of bags.For consumers,the convenience store overcomes a discrepancy of dimensions.

Question 12

The three basic functions a channel intermediary provides are transactional,logistical,and facilitating functions.

Question 13

Shopping goods are usually distributed selectively.Consumers are willing to look around for them but may not be willing to search or travel extensively to acquire the product.

Question 14

A merchant wholesaler is an institution that buys goods from manufacturers and resells them to businesses,government agencies,and other wholesalers or retailers.

Question 15

At one end of the channel relationship continuum is the "Arm's-length" relationship.

Question 16

Consider a scenario in which there are five manufacturers,no intermediaries,and four consumers.Twenty transactions would be required for each consumer to receive products from each manufacturer.The introduction of one intermediary reduces the required number of transactions to four and demonstrates the idea of contact efficiency.

Question 17

Exclusive distribution increases direct competition among retailers.

Question 18

Metallurgical Designs makes gold and silver charms for necklaces and bracelets.It markets its charms to a few retailers in any one region and promotes them intensively to those retailers.This is an example of intensive distribution.

Question 19

Transactional functions include contacting potential customers and assuming the risk of owning inventory.

Question 20

The direct channel is used more often in consumer markets than in business-to-business markets.

Question 21

Because distribution creates the same problems whether it is in Ethiopia,Indonesia,or Venezuela,you will find that channel structures and types around the world are very similar to those in the United States.

Question 22

When discussing the distribution of services,you will often hear channel members discussing the need to minimize wait times.

Question 23

McKesson Wholesalers provides healthcare products to pharmacies.It purchases bandages,gauze,antibacterial cream,and ointments from a variety of different manufacturers and resells them to pharmacies so that many of the items a customer might need for a cut will be available in the store.McKesson is aiding consumers by overcoming a:

A)spatial discrepancy
B)discrepancy of quantity
C)discrepancy of assortment
D)demand discrepancy
E)discrepancy of possession

Question 24

Certified Grocers Midwest,Inc. ,the Chicago-based grocery wholesale cooperative,provides all kinds of meats,cereals,canned and fresh fruits and vegetables,beauty aids,healthcare items,and pet products to the supermarkets in its channel.Certified Grocers is aiding consumers by overcoming:

A)spatial discrepancy
B)discrepancy of quantity
C)discrepancy of assortment
D)demand discrepancy
E)discrepancy of possession

Question 25

The Internet is quickly becoming an alternative channel for delivering services.

Question 26

The difference between the location of a producer and the location of widely scattered markets represents a(n)_____ discrepancy.

A)spatial
B)temporal
C)assortment
D)quantity
E)ownership

Question 27

Gray marketing channels assist brand name manufacturers in marketing their products more efficiently.

Question 28

Distribution channels aid in overcoming barriers to exchange that are created in the production process by overcoming all of the following types of discrepancies EXCEPT:

A)possession
B)assortment
C)quantity
D)spatial
E)temporal

Question 29

Lawn Boy manufactures 13 models of walk-behind lawn mowers and 6 types of riding mowers Even though lawn mowers is a product category that does not sell year-round,sales remain steady all year because Lawn Boy sells to wholesale distributors that stock the product.Its wholesale distributors are helping to overcome a(n)_____ discrepancy.

A)assortment
B)spatial
C)possession
D)quantity
E)temporal

Question 30

A _____ is a business structure of interdependent organizations that are involved in the process of making a product or service available for use or consumption by end customers or business users.

A)facilitating agency or place member
B)marketing mix intermediary
C)selective distribution channel
D)marketing channel or channel of distribution
E)transportation channel or channel of movement

Question 31

A(n)_____ discrepancy is created when a product is produced but a consumer is not ready to purchase it.

A)quantity
B)supply
C)possession
D)temporal
E)assortment

Question 32

Vicobello is a major manufacturer of outdoor fountains that are popular in gardens.Even though fountains represent a product category that does not sell year-round due to inclement weather,Vicobello's sales remain steady all year because it sells to wholesale distributors that stock the product.Its wholesale distributors are primarily helping to overcome a(n)_____ discrepancy.

A)assortment
B)spatial
C)possession
D)quantity
E)temporal

Question 33

A discrepancy of _____ is the difference between the amount of product produced and the amount an end user wants to buy.

A)space
B)quantity
C)assortment
D)accumulation
E)possession

Question 34

Scholastic Press published millions of copies of Mockingjay,the final installment in Suzanne Collin's popular Hunger Games trilogy of books.However,each reader wants to purchase just one copy.The difference between the number of books Scholastic Press published and the number a consumer wants to buy is referred to as a:

A)discrepancy of quantity.
B)discrepancy of assortment.
C)spatial discrepancy.
D)temporal discrepancy.
E)discrepancy of possession.

Question 35

Many regard vertical conflict as healthy competition.

Question 36

Which of the following is the lack of all the items a customer needs to receive full satisfaction from a product or products?

A)Discrepancy of assortment
B)Discrepancy of quantity
C)Spatial discrepancy
D)Temporal discrepancy
E)Discrepancy of possession

Question 37

Marketing channels can achieve economies of scale through:

A)overcoming spatial discrepancies
B)contact expertise
C)specialization and division of labor
D)overcoming temporal discrepancies
E)overcoming discrepancies of quantity

Question 38

Jones Soda is positioned as the anti-Coke.In the early years,few mainstream retailers sold Jones Soda.Fans had to get their Jones fix in surf shops,tattoo parlors,and bookstores,adding to the brand's mystique.Jones Soda used its _____ to create a competitive advantage.

A)channel ascendancy
B)distribution channel
C)channel conflict
D)channel focus
E)vertical integration

Question 39

Kayak.com is a company that allows customers to efficiently search databases to find the best airline and hotel deals all over the Web.Kayak does not make bookings but rather provides recommendations for the best travel plans.Travel providers pay Kayak a commission when customers click through to their sites.Kayak.com,travelers,the airlines,and the hotels are all part of a:

A)facilitating agency
B)marketing mix intermediary
C)selective promotion channel
D)marketing channel or channel of distribution
E)transportation channel or channel of movement

Question 40

Unlike marketers of physical products,marketers of services do not tend to address the question of logistics since services do not require a distribution strategy.

Question 41

Which of the following intermediaries sell mainly to consumers?

A)Retailers
B)Merchant wholesalers
C)Agents
D)Brokers
E)Specialists

Question 42

Marketing channels perform all of the following logistical activities EXCEPT:

A)sorting
B)storing
C)physically distributing
D)risk taking
E)breaking bulk

Question 43

Marketing channels make distribution simpler by reducing the number of transactions required to get products from manufacturers to consumers.This is called:

A)forward integration
B)contact efficiency
C)elimination of temporal discrepancies
D)sorting
E)reciprocity

Question 44

Agents and brokers:

A)have a great deal of control and risk invested in the goods.
B)only represent manufacturers in sales situations.
C)have a great deal of input on the terms of the sale.
D)generally are on salary with the manufacturer.
E)do not take title to merchandise.

Question 45

A(n)_____ is an institution that buys goods from manufacturers,takes title to these goods,and resells them to businesses,government agencies,and/or other wholesalers or retailers.

A)merchant wholesaler
B)agent
C)drop shipper
D)channel cooperative
E)marketing cooperative

Question 46

All of the following are sorting activities EXCEPT:

A)assorting
B)accumulation
C)sorting out
D)allocation
E)possession

Question 47

Which of the following is a transactional function performed by intermediaries?

A)Sorting
B)Researching
C)Risk taking
D)Physically distributing
E)Storing

Question 48

Which of the following is a logistical function performed by intermediaries?

A)Sorting
B)Negotiating
C)Financing
D)Risk taking
E)All of these choices

Question 49

Generally,_____ determine what type of intermediary a manufacturer should use.

A)product characteristics,buyer consideration,and market characteristics
B)only internal environmental characteristics
C)competitive conditions and government regulations
D)all controllable marketing factors
E)only noncontrollable environmental factors

Question 50

W.W.Grainger,Inc.is one of the world's largest business-to-business distributors of equipment,component parts,and supplies in the United States and Canada.It has ownership title to over 220,000 products,which are stocked in one national and nine regional warehouses to guarantee product availability and quick service to the many manufacturers who are its customers.W.W.Grainger is an example of a(n):

A)agent or broker
B)merchant wholesaler
C)retailer
D)consumer market
E)hypermarket intermediary

Question 51

When an intermediary in the channel of distribution owns the merchandise and controls the terms of the sale,this is referred to as:

A)complete control
B)exclusive distribution
C)taking title
D)contact efficiency
E)economies of scale

Question 52

A Target store is an example of a(n):

A)merchant wholesaler
B)retailer
C)broker
D)agent
E)exporter

Question 53

Retailers and merchant wholesalers are examples of intermediaries that:

A)take title to a product
B)create temporal and spatial discrepancies
C)use consumer promotions
D)do not benefit from any economies of scale
E)are accurately described by all of these statements

Question 54

The three basic functions channel intermediaries perform are:

A)transactional,logistical,and facilitating
B)contacting,negotiating,and ownership
C)promoting,distributing,and bulk-breaking
D)assorting,accumulating,and allocating
E)financing,mediating,and storing

Question 55

Transactional channel functions include all of the following activities EXCEPT:

A)contacting buyers
B)promoting the products to be sold
C)taking the risks associated with product inventories
D)negotiating the sale
E)physical distribution and sorting

Question 56

The major characteristic that is used to differentiate among types of intermediaries is whether they:

A)install exchange barriers such as location,time,and quantity
B)create specialization of labor
C)create economies of scale
D)take title to the products they sell
E)raise profit margins for independent middlemen

Question 57

The efficient and cost-effective forward and reverse flow and storage of goods,services,and related information into,through,and out of channel member companies is called:

A)systematization.
B)logistics.
C)engineering.
D)distribution.
E)coordination.

Question 58

YKK slide fasteners (zippers)are made in Macon,Georgia,yet manufactures all over the world use zippers to manufacture,clothes,luggage,shoes,and other items.Wholesalers around the world primarily help to overcome a(n)_____ discrepancy.

A)creation
B)temporal
C)assortment
D)spatial
E)ownership

Question 59

_____ are intermediaries who facilitate the sales of a product from producer to end user by representing retailers,wholesalers,or manufacturers and providing little input as to the terms of the sale.

A)Marketing facilitators
B)Channel cooperatives
C)Agents and brokers
D)Merchant wholesalers
E)Channel functionaries

Question 60

_____ considerations affecting the wholesaler choice include how often a product is purchased and how long a customer is willing to wait to receive the product.

A)Market
B)Transactional
C)Product
D)Buyer
E)Logistic

Question 61

One configuration of a marketing channel entails producers selling to consumers with no intermediaries involved.This is called a:

A)limited distribution system
B)conventional channel
C)vertical marketing system
D)reciprocal channel
E)direct channel

Question 62

A worker who categorizes eggs into Grade AA,Grade A,and Grade B categories is engaging in the _____ process.

A)sorting-out.
B)accumulating.
C)storing.
D)downsizing.
E)distributing.

Question 63

When Delphi-Grundig,a manufacturer of state-of-the-art car radios,decided to expand its marketing efforts into countries in which its products are not currently available,it did not have the time or resources to spend on developing new channels of distribution.Delphi-Grundig should consider a(n):

A)industrial distributor.
B)franchising system.
C)reverse channel.
D)strategic channel alliance.
E)channel cooperative.

Question 64

With respect to the sorting logistical function,_____ is the combining of similar stocks into a larger homogeneous supply.

A)sorting out
B)accumulating
C)allocating
D)breaking bulk
E)assorting

Question 65

Which of the following is most likely to use a retailer channel of distribution?

A)car dealer
B)convenience store
C)farmer
D)neighborhood diner
E)freelance editor

Question 66

Canesta Company has developed a virtual keyboard out of light to be used with cell phones and PDAs.The product beams an image of a keyboard on a desk,allowing the user to type on the image.The words are picked up by the user's digital device.When introduced to the market,the device will sell for less than $50.If,in choosing its channel,Canesta is most concerned about the life cycle of the device,then its choice of channels will largely be influenced by:

A)factors of production
B)customer characteristics
C)ownership factors
D)product factors
E)market factors

Question 67

Which of the following are examples of facilitating functions performed by wholesaling intermediaries?

A)Sorting and storing
B)Risk taking and promotion
C)Assorting,accumulating,grading,and allocating
D)Researching and financing
E)Financial management and storing

Question 68

A _____ channel is commonly used for low-cost consumer items that are frequently purchased,such as candy,cigarettes,and magazines.

A)retailer
B)agent/broker
C)industrial distributor
D)producer
E)wholesaler

Question 69

Selfridges is the second-largest department store in Great Britain.It works with House of Frasier,one of its competitors,to reduce operating costs by sharing channels of distribution to ship goods from 1,500-plus suppliers.Selfridges and House of Frasier are engaged in:

A)vertical conflict
B)an integrated supply chain
C)a strategic channel alliance
D)an information-based distribution channel
E)a distribution cooperative

Question 70

Customers can purchase Hewlett-Packard computers from retail stores like Best Buy and Office Depot,online directly from HP,and through various catalogs.HP is using a(n)_____ distribution arrangement.

A)intensive
B)multiple
C)exclusive
D)cumulative
E)aggregated

Question 71

_____ describes the process of strategically managing the efficient flow and storage of raw materials,in-process inventory,and finished goods from point of origin to point of consumption.

A)Contract logistics
B)Logistics
C)Cross-docking
D)Disintermediation
E)Channel facilitation

Question 72

Which of the following statements concerning how market factors affect channel decisions is true?

A)Industrial customers tend to buy in larger quantities and require more customer service.
B)Geographically concentrated target markets should be served with an indirect sales force.
C)Widely dispersed markets require fewer intermediaries.
D)New firms in extremely competitive markets will be more successful if they use indirect channels.
E)A very large market requires fewer intermediaries.

Question 73

Nontraditional channel arrangements:

A)tend to make a firm's product seem the same as the competition.
B)usually broaden a brand's coverage.
C)can give a producer serving a niche market a way to gain market access without having to establish channel intermediaries.
D)are not usually useful for larger firms.
E)All of the above are true.

Question 74

Which of the following enables a company to use another manufacturer's already established channel?

A)Strategic channel alliances
B)Relationship channels
C)Reverse channels
D)Multiple distribution systems
E)Nontraditional channelization

Question 75

All of the following are typical channel members in marketing channels for consumer products EXCEPT:

A)retailers
B)agent/brokers
C)industrial distributors
D)producers
E)wholesalers

Question 76

Companies selling standardized items of moderate or low value to other businesses (not to consumers)often use:

A)retailers
B)industrial distributors
C)wholesalers
D)bulk breakers
E)industrial resellers

Question 77

Vutek manufactures printing machines used to print high-resolution graphics for billboards,bus cards,banners,and posters.For distribution,you would expect Vutek to use a:

A)network of facilitating agents
B)horizontally integrated channel
C)reciprocal channel
D)direct channel
E)vertical marketing system

Question 78

Serenity is a manufacturer of outdoor fountains that are popular in gardens.Even though fountains represent a product category that does not sell year-round due to inclement weather,Serenity's sales remain steady all year because it sells to wholesale distributors that stock the product.Serenity sells to wholesale distributors that perform _____ functions for the manufacturer.

A)financial
B)transactional
C)facilitating
D)logistical
E)promotional

Question 79

_____ distribution occurs when a producer selects two or more different channels to distribute the same products to target markets.

A)Selective
B)Intensive
C)Dual
D)Contractual
E)Cumulative

Question 80

The only way that Jim Keeler in New Mexico can get a box of Carolyn Popwell's Festive Holiday Truffles from Washington is to order it through the mail.Popwell,who makes the candy by hand,uses a(n)_____ exclusively.

A)exclusive distribution system
B)conventional channel
C)vertical marketing system
D)reciprocal channel
E)direct channel