Question 1

A channel level is a layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer.

Accepted Answer

A) True 
 B)False  True

Question 2

Give an example of channel conflict.

Accepted Answer

This type of conflict occurs among firms at the same level of the channel; an example would be two Chevrolet dealers in the St. Louis area complaining that each is being undercut by the other.

Question 3

Orion Steel is the chief provider of metals to Accline Cars, which manufactures two models of vehicles-cars and large buses. Accline dealers sell the firm's cars to individual citizens, but buses are sold directly to government entities. In such a distribution channel, which of the following would be considered a vertical conflict?

Accepted Answer

A)  a conflict between Orion Steel and Accline Cars
B)  a conflict between Orion Steel and Accline dealers
C)  a conflict between two Accline car dealers
D)  a conflict between Accline dealers and government entities
E)  a conflict between Accline Cars and its dealers E

Question 4

Rage, a leading motor vehicle manufacturer, introduces a new superbike model. It invites proposals from independent dealers who are willing to set up exclusive showrooms that only sell Rage's superbikes. Chosen dealers will sell and service the superbikes, and Rage will oversee national advertising. This is most likely an example of a(n)________.

Accepted Answer

A)  administered vertical marketing system
B)  horizontal manufacturing marketing system
C)  manufacturer-sponsored retailer franchise system
D)  manufacturer-sponsored wholesaler franchise system
E)  direct marketing system

Question 5

________ distribution gives producers good market coverage with more control and less cost than does intensive distribution.

Accepted Answer

A)  Vertical
B)  Selective
C)  Horizontal
D)  Comprehensive
E)  Inclusive

Question 6

Sonic Shack, an audio equipment retailer, signs an agreement with PineWire, a renowned electronics company, to sell PineWire products. The deal requires Sonic Shack to provide PineWire products with superior displays, shelf space, and promotion compared to competing products. Sonic agrees to these terms as PineWire products command a huge share in the market. Which of the following types of channel arrangements do PineWire and Sonic Shack most likely have?

Accepted Answer

A)  administered vertical marketing system
B)  corporate vertical marketing system
C)  indirect marketing system
D)  wholesaler franchise system
E)  horizontal marketing system

Question 7

In creating customer value, it is more important for a company to build relationships with downstream channel partners than with upstream supplier partners.

Accepted Answer

A) True 
 B)False

Question 8

A(n)________ marketing system combines successive stages of production and distribution under single ownership, where channel leadership is established through common ownership.

Accepted Answer

A)  contractual vertical
B)  corporate vertical
C)  administered vertical
D)  horizontal
E)  direct

Question 9

In a just-in-time logistics system, ________.

Accepted Answer

A)  retailers carry small inventories of merchandise to last for only a few days
B)  retailers store products for long periods to avoid an interruption in supply
C)  producers supply products to resellers before customers place their orders
D)  producers that are geographically far from their retailers use an express-delivery system
E)  retailers incur high inventory-carrying and inventory-handling costs

Question 10

A(n)________ marketing system is a marketing system in which independent firms at different levels of production and distribution join together through binding agreements.

Accepted Answer

A)  corporate vertical
B)  horizontal
C)  contractual vertical
D)  administered vertical
E)  direct

Question 11

Which of the following would be considered an upstream partner in a company's supply chain?

Accepted Answer

A)  a firm that resells a finished product and shares the net sales with the producer
B)  a firm that provides technical expertise in the production of a product
C)  a firm that markets a product to consumers through social media
D)  a firm that buys products at wholesale cost from the company
E)  a firm that exclusively markets a product to other businesses

Question 12

When a seller requires that only certain dealers carry its products, its strategy is known as ________.

Accepted Answer

A)  horizontal restraint of trade
B)  intensive distribution
C)  vertical distribution
D)  disintermediation
E)  exclusive distribution

Question 13

Reverse logistics refers to moving ________.

Accepted Answer

A)  unwanted, excess products from resellers to producers
B)  raw materials from suppliers to the factory
C)  excess materials from the factory to suppliers
D)  finished products from the factory to customers
E)  finished products from producers to resellers

Question 14

Wholesaling includes all the activities involved in selling products or services directly to final consumers for their personal, nonbusiness use.

Accepted Answer

A) True 
 B)False

Question 15

Customer-centered logistics starts with the marketplace and works backward to the factory.

Accepted Answer

A) True 
 B)False

Question 16

Jupiter Steel is the chief provider of metals to Greystone Motors. Greystone Motors has two models of cars-one for commercial and ordinary consumers and another for professional car racing teams. Greystone Motors has designated dealers to sell its commercial cars to consumers, while racing cars are sold directly to the racing teams. In such a distribution channel, which of the following would be considered a horizontal conflict?

Accepted Answer

A)  a conflict between Jupiter Steel and Greystone Motors
B)  a conflict between Jupiter Steel and Greystone dealers
C)  a conflict between two Greystone Motors car dealerships
D)  a conflict between a Greystone Motors car dealership and a racing team
E)  a conflict between Greystone Motors and its car dealerships

Question 17

Mary Jay, an American designer of luxury leather goods, had experienced growth by selling her goods in her own retail stores. As internet usage increased, Mary Jay did what many of her competitors did: she created a virtual online store on her company website. When the Canadian and US dollars were on par, many Canadian shoppers would purchase online through the US website since there were no retailers in Canada carrying Mary Jay goods. Eventually, Mary Jay opened her own retail stores in Canada after considering the risks and advantages of going global. She also created opportunities with major department stores to carry her goods under specific conditions.
-Describe possible conflicts that can arise.

Accepted Answer

The answer of Mary Jay, an American designer of luxury...

Question 18

How does a company determine its channel objectives? What factors influence the channel objectives of a company?

Accepted Answer

The answer of How does a company determine its channel...

Question 19

Today, fewer companies outsource their logistics to third-party logistics providers.

Accepted Answer

A) True 
 B)False

Question 20

How can a firm benefit from participating in a horizontal marketing system?

Accepted Answer

The answer of How can a firm benefit from participating...

Exam 11: Marketing Channels

A channel level is a layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer.

Give an example of channel conflict.

________ distribution gives producers good market coverage with more control and less cost than does intensive distribution.

In creating customer value, it is more important for a company to build relationships with downstream channel partners than with upstream supplier partners.

A(n) ________ marketing system combines successive stages of production and distribution under single ownership, where channel leadership is established through common ownership.

In a just-in-time logistics system, ________.

A(n) ________ marketing system is a marketing system in which independent firms at different levels of production and distribution join together through binding agreements.

Which of the following would be considered an upstream partner in a company's supply chain?

When a seller requires that only certain dealers carry its products, its strategy is known as ________.

Reverse logistics refers to moving ________.

Wholesaling includes all the activities involved in selling products or services directly to final consumers for their personal, nonbusiness use.

Customer-centered logistics starts with the marketplace and works backward to the factory.

How does a company determine its channel objectives? What factors influence the channel objectives of a company?

Today, fewer companies outsource their logistics to third-party logistics providers.

How can a firm benefit from participating in a horizontal marketing system?