Question 1

Roscoe Hardware carries stock on the complete line of Ever-Green Push Lawn Mowers. Its competitor down the street sells the same mowers at a special price by special order but does not carry any inventory. This situation creates

Accepted Answer

A)  vertical conflict. 
B)  exclusive distribution rights. 
C)  competitive discrepancy. 
D)  horizontal conflict. 
E)  reverse channels.

Question 2

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 3

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 4

Distribution costs can be very low for digital products because there is often no physical good to distribute.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is true of direct distribution?

Accepted Answer

A)  It requires a significant investment in facilities. 
B)  It reduces a producer's need for working capital. 
C)  Direct distribution always serves customer needs better and at a lower cost. 
D)  Most firms selling consumer products rely on direct distribution. 
E)  It is easy to change customer buying patterns from indirect distribution to direct distribution.

Question 6

The desirability of a common "product-market commitment" is based on the idea that:

Accepted Answer

A)  each member of the channel should focus on a different target market. 
B)  the whole channel is competing with other channel systems. 
C)  the producer should always be the "channel captain." 
D)  a channel can eliminate the marketing functions. 
E)  All of these ideas are relevant.

Question 7

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.
These three tennis ball producers all rely on retailers to reach consumers who want to buy only a few balls at a time. Apparently they all think that this is an efficient way to

Accepted Answer

A)  deal with sorting activities. 
B)  address discrepancies of quantity. 
C)  handle discrepancies of assortment. 
D)  minimize the potential for conflict in the channel. 
E)  achieve intensive distribution.

Question 8

Accumulating involves collecting products from many small producers--often as a way to get lower transportation rates.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements about Place is FALSE?

Accepted Answer

A)  Place variations are required when target markets have different needs. 
B)  Product classes suggest Place objectives. 
C)  Place decisions have relatively little impact on competition in a product-market. 
D)  Place decisions have longer-run implications than Price decisions. 
E)  Place decisions need to consider when customers want products.

Question 10

If a producer has a technically superior and expensive product--which has achieved brand preference--and wants retailers to provide aggressive promotion and maximum customer service, this producer should seek:

Accepted Answer

A)  Multichannel distribution. 
B)  Exclusive distribution. 
C)  Administered distribution. 
D)  Intensive distribution. 
E)  Selective distribution.

Question 11

Ravi Singh is working his way through college as an independent distributor of the Rapier Knife Co. The Rapier product line includes kitchen knives, hunting knives, and other special-purpose cutlery. Ravi makes sales presentations to potential customers in their homes. If a customer wants to make a purchase, Ravi buys the knives from Rapier and sells them to the customer at a markup. For example, Rapier's most popular knife is a chef's knife that Ravi buys for $25 and resells to the consumer for $50. Ravi:

Accepted Answer

A)  Is part of a direct-to-customer channel. 
B)  Is engaged in direct marketing. 
C)  Is engaged in direct selling, but is part of an indirect channel. 
D)  None of these alternatives is correct.

Question 12

Traditional channels of distribution

Accepted Answer

A)  do not perform bulk-breaking activities. 
B)  are usually preferred to other distribution arrangements. 
C)  are easier to control than corporate channel systems. 
D)  may involve little or no cooperation among channel members. 
E)  are usually controlled through strong legal contracts.

Question 13

Selling products manufactured in the United States to foreign customers--often without any product changes--is called:

Accepted Answer

A)  joint ventures. 
B)  licensing. 
C)  importing. 
D)  contract manufacturing. 
E)  exporting.

Question 14

Horizontal arrangements among competing retailers, wholesalers, or producers to limit sales by customer or territory have consistently been

Accepted Answer

A)  shown to increase competition. 
B)  a regular practice in the U.S. 
C)  encouraged in the U.S. but not in many international markets. 
D)  a successful strategy for entering international markets. 
E)  ruled illegal by the U.S. Supreme Court.

Question 15

______________ means selling a product only through those intermediaries who will give the product special attention.

Accepted Answer

A)  Multichannel distribution 
B)  Selective distribution 
C)  Administered distribution 
D)  Exclusive distribution 
E)  Intensive distribution

Question 16

Product classes help marketing managers understand how much market exposure will be needed in each geographic area.

Accepted Answer

A) True 
 B)False

Question 17

"Place" decisions:

Accepted Answer

A)  may focus on the location of retail stores and wholesale facilities. 
B)  may focus on the selection and use of intermediaries and collaborators. 
C)  can be aided by knowing about the product classes. 
D)  are harder to change than Product, Promotion, or Price decisions. 
E)  All of these choices are correct.

Question 18

"Ideal market exposure" means selling a product through all intermediaries willing to stock and sell it.

Accepted Answer

A) True 
 B)False

Question 19

Place decisions are easier to change in the short-run than Product, Price, and Promotion decisions.

Accepted Answer

A) True 
 B)False

Question 20

"Exclusive distribution" means selling through:

Accepted Answer

A)  the most prestigious retail outlets. 
B)  only one wholesaler or retailer in a particular geographic area. 
C)  only responsible and suitable retailers or wholesalers. 
D)  retailers that handle specialty products. 
E)  only those wholesalers or retailers who will give the product special attention.

Exam 10: Place and Development of Channel Systems

Roscoe Hardware carries stock on the complete line of Ever-Green Push Lawn Mowers. Its competitor down the street sells the same mowers at a special price by special order but does not carry any inventory. This situation creates

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

Intensive distribution is often very appropriate for:

Distribution costs can be very low for digital products because there is often no physical good to distribute.

Which of the following is true of direct distribution?

The desirability of a common "product-market commitment" is based on the idea that:

Accumulating involves collecting products from many small producers--often as a way to get lower transportation rates.

Which of the following statements about Place is FALSE?

If a producer has a technically superior and expensive product--which has achieved brand preference--and wants retailers to provide aggressive promotion and maximum customer service, this producer should seek:

Traditional channels of distribution

Selling products manufactured in the United States to foreign customers--often without any product changes--is called:

Horizontal arrangements among competing retailers, wholesalers, or producers to limit sales by customer or territory have consistently been

______________ means selling a product only through those intermediaries who will give the product special attention.

Product classes help marketing managers understand how much market exposure will be needed in each geographic area.

"Place" decisions:

"Ideal market exposure" means selling a product through all intermediaries willing to stock and sell it.

Place decisions are easier to change in the short-run than Product, Price, and Promotion decisions.

"Exclusive distribution" means selling through: