Question 1

Vertical marketing systems account for a majority of U.S.retail sales.

Accepted Answer

A) True 
 B)False

Question 2

Indirect channels are probably a better choice than direct channels when:

Accepted Answer

A)  the firm has limited financial resources. 
B)  the product is a consumer product instead of a business product. 
C)  target customers already have established buying patterns for where to search for the product. 
D)  retailers are already conveniently located where consumers shop. 
E)  all of these make indirect channels a better choice.

Question 3

When Amazon.com collects products from many small producers,the company is involved in _____.

Accepted Answer

A)  assorting 
B)  accumulating 
C)  bulk-breaking 
D)  quantitizing 
E)  sorting

Question 4

A "channel captain"

Accepted Answer

A)  might be any member of the channel (that is, at any level in the channel). 
B)  views the members of the channel as a unit. 
C)  should help to make the channel more efficient by reducing conflict. 
D)  all of these alternatives are correct.

Question 5

"Discrepancies of quantity" means:

Accepted Answer

A)  some consumers buy more products than others. 
B)  there are more consumers than producers. 
C)  some manufacturers can produce more products than others. 
D)  the difference between the quantity of products it is economical for an individual producer to make and the quantity normally wanted by individual consumers or users. 
E)  that demand is greater than what a company can supply.

Question 6

Use this information for question that refer to the World Tennis Ball (WTB)Company case. World Tennis Ball Co.(WTB)makes tennis balls and sells them only in the U.S.Raul Fernandez,the firm's marketing manager,is comparing his firm's distribution with two major competitors.
1)WTB sells its products through four regional distributors who then sell to 22 sporting goods wholesalers.The wholesalers sell to a total of 7,000 retail outlets.From its website,WTB also sells directly to any customer who will purchase a minimum quantity of 24 tennis balls.WTB cooperates with members of its channel,but maintains some control through its economic power and leadership.It helps to direct the activities of the whole channel and tries to avoid or resolve channel conflicts.
2)American Tennis Ball (ATB)is a competitor that sells through two distributors-each with half the country.The distributors then sell through 6 sporting goods wholesalers,and they,in turn,sell to 1,000 retail outlets (split between two national sporting goods chains and two general merchandise stores).ATB and its channel make little effort to work together.However,because of a relatively low level of competition between the distributors,the wholesalers,or the retail stores,each member of the channel gives the product special attention.
3)National Tennis Ball (NTB)sells its products through only three tennis specialty wholesalers that sell only to tennis clubs.NTB actually owns the wholesale firms that handle its products.NTB's balls are only available at certain tennis clubs and NTB limits coverage to only one club in a particular geographic area.
Which of these companies appears to operate as a channel captain?

Accepted Answer

A)  WTB 
B)  ATB 
C)  NTB 
D)  All of the companies appear to be channel captains 
E)  None of the companies is a channel captain

Question 7

A firm would prefer an administered channel system to a corporate channel system for all the following reasons except:

Accepted Answer

A)  managing all manufacturing, wholesaling, and retailing functions in a channel is too challenging. 
B)  administered channel systems are more costly to operate than corporate systems. 
C)  corporate channel systems offer more control over marketing activities than administered systems. 
D)  administered channel systems offer good enough channel cooperation for the firms' distribution needs. 
E)  administered channel systems have some of the same benefits of corporate channel systems but without the expense.

Question 8

Which of the following is NOT a Place decision?

Accepted Answer

A)  Types of intermediaries needed. 
B)  Degree of market exposure desired. 
C)  Recruiting, selecting and managing the sales force. 
D)  Type of distribution channel to use. 
E)  Customer service level desired.

Question 9

Some sporting goods manufacturers do not make a "full line" of equipment.So the Sports World retail chain carefully selects the brands of several manufacturers to sell.This regrouping activity is called ________.

Accepted Answer

A)  accumulating 
B)  assorting 
C)  retailing 
D)  bulk-breaking 
E)  sorting

Question 10

A publisher of photography books finds that it is cost-effective to print 10,000 or more at a time.But a bookstore orders only a few copies of each book since its customers want to select from a wide variety.This example shows

Accepted Answer

A)  why discrepancies of quantity occur. 
B)  why both discrepancies of quantity and assortment occur. 
C)  neither discrepancies of assortment or quantity. 
D)  why discrepancies of assortment occur. 
E)  multichannel distribution.

Question 11

Intensive distribution is selling through only those intermediaries who will give the product special attention.

Accepted Answer

A) True 
 B)False

Question 12

Intensive distribution is often very appropriate for:

Accepted Answer

A)  shopping products and convenience products. 
B)  convenience products and business supplies. 
C)  business products of all classes. 
D)  unsought products and specialty products. 
E)  shopping, specialty, and unsought products.

Question 13

Which of the following statements about Place is not true?

Accepted Answer

A)  Most consumer products move from producer to intermediaries to final customer. 
B)  A series of participants in the flow of goods and services from producer to final customer is called a channel of distribution. 
C)  There is always one Place arrangement that is "best" for a product. 
D)  Intermediaries develop to adjust discrepancies in quantity and assortment. 
E)  All of these statements about Place are true.

Question 14

If Walmart purchases a manufacturing plant to produce nothing but Walmart's dealer brand of laundry detergent,Walmart is engaging in ________.

Accepted Answer

A)  Monopoly 
B)  Vertical integration 
C)  Intertype competition 
D)  A contractual channel system 
E)  An administered channel system

Question 15

Direct marketing is

Accepted Answer

A)  personal sales contact between a representative of the company and an individual consumer. 
B)  primarily concerned with the degree of market exposure. 
C)  direct communication between a seller and an individual customer using a promotion method other than face-to-face personal selling. 
D)  an effort to sell through only one intermediary. 
E)  a strategy that works best when a producer has little working capital.

Question 16

Which of the following is NOT a true statement about traditional channel systems?

Accepted Answer

A)  Channel members make little or no effort to cooperate with each other. 
B)  Channel members buy and sell from each other. 
C)  Each channel member does only what it considers to be in its own best interest. 
D)  Members of these channels have their independence, but they may pay for it too. 
E)  Control is maintained by economic power and leadership.

Question 17

Use this information for question that refer to the World Tennis Ball (WTB)Company case. World Tennis Ball Co.(WTB)makes tennis balls and sells them only in the U.S.Raul Fernandez,the firm's marketing manager,is comparing his firm's distribution with two major competitors.
1)WTB sells its products through four regional distributors who then sell to 22 sporting goods wholesalers.The wholesalers sell to a total of 7,000 retail outlets.From its website,WTB also sells directly to any customer who will purchase a minimum quantity of 24 tennis balls.WTB cooperates with members of its channel,but maintains some control through its economic power and leadership.It helps to direct the activities of the whole channel and tries to avoid or resolve channel conflicts.
2)American Tennis Ball (ATB)is a competitor that sells through two distributors-each with half the country.The distributors then sell through 6 sporting goods wholesalers,and they,in turn,sell to 1,000 retail outlets (split between two national sporting goods chains and two general merchandise stores).ATB and its channel make little effort to work together.However,because of a relatively low level of competition between the distributors,the wholesalers,or the retail stores,each member of the channel gives the product special attention.
3)National Tennis Ball (NTB)sells its products through only three tennis specialty wholesalers that sell only to tennis clubs.NTB actually owns the wholesale firms that handle its products.NTB's balls are only available at certain tennis clubs and NTB limits coverage to only one club in a particular geographic area.
Which of the following describes WTB's channel arrangements?

Accepted Answer

A)  Intensive distribution 
B)  Corporate channel system 
C)  Exclusive distribution 
D)  Traditional channel system 
E)  Reverse channels

Question 18

In general,marketers that seek greater control over their marketing mixes in the international environment will:

Accepted Answer

A)  hire more marketing managers. 
B)  invest more financial resources and take greater risks. 
C)  use intensive distribution. 
D)  choose to export or license. 
E)  set up traditional global channels.

Question 19

In ________ channel systems,ordering is routinized,inventory and sales information is shared over computer networks,accounting is standardized,and promotion efforts are coordinated.

Accepted Answer

A)  contractual 
B)  traditional 
C)  administered 
D)  integrated 
E)  corporate

Question 20

"Discrepancies of quantity" means ________.

Accepted Answer

A)  there are more producers than consumers 
B)  there are more consumers than producers 
C)  the difference between the product lines the typical producer makes and the assortment wanted by consumers or final users 
D)  consumers want more products than producers can make 
E)  the difference between the quantity of products it is economical for an individual producer to make and the quantity normally wanted by individual consumers or users

Exam 12: Place and Development of Channel Systems