Deck 14: Marketing Channels and Supply Chain Management

Question 1

Marketing channels increase the number of marketplace contacts necessary to make a sale.

Answer 1

False

Question 2

The simplest and shortest marketing channel is a direct channel.

Answer 2

True

Question 3

A marketing intermediary is an organization that operates between producers and consumers or business users.

Answer 3

True

Question 4

An agent,who connects small companies with the consumers,always takes possession of the goods as well as the title.

Question 5

The traditional channel for consumer goods proceeds from producer to wholesaler to retailer to user.

Question 6

Physical distribution refers to a broad range of activities aimed at efficient movement of finished goods from the end of the production line to the consumer.

Question 7

A marketing channel is an organized system of marketing institutions and their interrelationships that enhances the physical flow and ownership of products from producer to consumer or business user.

Question 8

The first thing to do in selecting a marketing channel is to determine which type of channel will best meet both the seller's objectives and the distribution needs of customers.

Question 9

The term industrial distributor commonly refers to intermediaries in the business market that take title to the goods.

Question 10

Service firms market primarily through long distribution channels.

Question 11

Supply chain management refers to the control of the activities of purchasing,processing,and delivery through which raw materials are transformed into products and made available to final consumers.

Question 12

A wholesaler is an intermediary that takes title to the goods it handles and then distributes these goods to retailers,other distributors,or sometimes end consumers.

Question 13

Not-for-profit organizations tend to distribute their products through long,multi-level channels using wholesalers as intermediaries.

Question 14

A business product with large unit sales,for which transportation accounts for only a small percentage of the total cost,is usually distributed using the producer-agent-business user channel.

Question 15

The terms "transportation" and "physical distribution" can be used interchangeably because these terms carry the same meaning.

Question 16

Business products tend to move through longer marketing channels than consumer products.

Question 17

Distributors adjust for discrepancies in the market's assortment of goods and services via a process known as suboptimization.

Question 18

One of the functions of marketing channels is to facilitate searches by both buyers and sellers.

Question 19

Direct selling is an important option for goods requiring extensive demonstrations in persuading customers to buy.

Question 20

Logistics is the process of coordinating the flow of information,goods,and services among members of the distribution channel.

Question 21

Horizontal territorial restrictions result from agreements between retailers or wholesalers to avoid competition among sellers of products from the same producer.

Question 22

High sales volume spreads selling costs over a large number of items,generating adequate returns from direct sales.

Question 23

Producers and dealers whose sales volumes represent a substantial percentage of total sales in the market area will be guilty of violating the Clayton Act if they enter into exclusive dealing agreements.

Question 24

NikSnak,a popular potato wafers brand,is most likely to use an exclusive distribution strategy.

Question 25

Changing channel strategies can produce conflicts between established intermediaries and the new channels for the product.

Question 26

Manufacturers of specialty or luxury goods limit the number of retailers that can carry their products.

Question 27

If producers set up closed sales territories that substantially decrease competition,then it is in violation of the Federal Trade Commission Act and provisions of the Sherman and Clayton Acts.

Question 28

The strategy of selective distribution involves distributing a product through a limited number of channels.

Question 29

Legal provisions against pollution and conservation laws have increased the importance of reverse channels.

Question 30

Closed sales territories are exclusive geographic selling region of a distributor.

Question 31

When a producer grants exclusive rights to a wholesaler or retailer to sell its products in a specific geographic region it practices intensive distribution.

Question 32

Product recalls and repairs are handled through reverse channels.

Question 33

Relatively standardized items that are also nonperishable and products with low unit costs pass through comparatively long channels of distribution.

Question 34

Selective distribution helps marketers reduce total marketing costs while establishing strong working relationships within the channel.

Question 35

Marketers usually adopt a dual distribution strategy either to maximize their firm's coverage in the marketplace or to increase the cost effectiveness of the firm's marketing effort.

Question 36

A merchant wholesaler is an independently owned wholesaler that takes title to the goods.

Question 37

In exclusive distribution,producers and retailers cooperate closely in decisions concerning advertising and promotion,inventory carried by the retailers,and prices.

Question 38

Dual distribution is the movement of products through more than one channel to reach the firm's target market.

Question 39

Lands' End products are sold through catalogs,the Internet,and Sears retail stores.The Lands' End brand practices dual distribution.

Question 40

Exclusive distribution allows greater market coverage than any other distribution strategy.

Question 41

Horizontal conflict causes problem between different types of marketing intermediaries that handle similar products.

Question 42

When a producer decides to advertise products on its website and sell them online,while continuing to distribute products to its current retailer customer base,the decision is likely to result in horizontal channel conflict.

Question 43

Tandy Corporation has its own distribution network that transports its products to its own retail stores.This is an example of a corporate marketing system.

Question 44

A third-party (contract)logistics firm is a company that specializes in handling logistics activities for other firms.

Question 45

Simple Foods,a breakfast cereal brand,has two wholesalers supplying to almost 100 retailers in California.Conflicts arising between the retailers and wholesalers within California will be referred to as horizontal conflicts.

Question 46

A meat packing unit's downstream management would oversee storage and warehousing of meat as well as the transportation of the meat to its plant where it is processed and packed.

Question 47

The biggest advantage of a physical distribution system is that its components are independent and hence,a decision in one area is unlikely to affect the functioning of the other components.

Question 48

The complete sequence of suppliers and activities that contribute to the creation and delivery of goods and services is known as the supply chain.

Question 49

A value-added service is a basic service that customers normally receive and expect.

Question 50

Gray goods are products manufactured abroad under license from a U.S.firm and then sold in the U.S.market in competition with that firm's own domestic output.

Question 51

The supply chain begins with the movement of finished products through the marketing channel to customers.

Question 52

Merle Norman,a cosmetics manufacturer,sells its products exclusively through its own retail stores.This is an example of forward integration of distribution channels.

Question 53

An example of vertical conflict within the clothing industry would be when a firm such as Jones,New York decides to sell its line of women's blazers directly to consumers via their website,as opposed to distributing them via its usual wholesale channels.

Question 54

Customer service standards state the goals and define acceptable performance for the quality of service that a firm expects to deliver to its customers.

Question 55

An enterprise resource planning (ERP)system is a software system that consolidates data from among a firm's various business units.

Question 56

When a beverage company acquires a water purification plant,it is an example of backward integration of distribution channels.

Question 57

A wholesaler-sponsored voluntary chain allows retailers to save on advertising costs.

Question 58

The dominant and controlling member of a marketing channel is called the channel captain.

Question 59

The U.S.Supreme Court has ruled that horizontal territorial restrictions may meet legal criteria in certain cases but it has consistently declared vertical territorial restrictions to be illegal.

Question 60

The term "suboptimization" refers to a condition that results when individual operations achieve their objectives but interfere with progress toward broader organizational goals.

Question 61

Common carriers cannot conduct their operations without permission from the appropriate regulatory authority.

Question 62

Common carriers operate under much looser regulations than contract carriers.

Question 63

A distribution warehouse holds goods for moderate to long periods in an attempt to balance supply and demand for producers and purchasers.

Question 64

Unit trains run back and forth between single loading points and single destinations to deliver a commodity.

Question 65

In transportation,a class rate is the standard rate for a specific commodity moving between any pair of destinations.

Question 66

A storage warehouse assembles and redistributes goods,keeping them moving as much as possible.

Question 67

Piggyback service is the most widely used form of intermodal coordination.

Question 68

Pipelines can accommodate shipments of a large number of products.

Question 69

Designers of a physical distribution system begin by establishing acceptable levels of customer service.

Question 70

Freight carriers often charge class rates as a reward for either regular business or a large shipment.

Question 71

Shippers that transport goods via water carriers incur very low costs compared with the rates for other transportation modes.

Question 72

In piggyback operations,highway trailers and containers ride on railroad flatcars,thus combining the long-haul capacity of the train with the door-to-door flexibility of the truck.

Question 73

Railroads control the largest share of the freight business in the United States as measured by ton-miles.

Question 74

Common carriers move freight via all modes of transport.

Question 75

Freight forwarders act as transportation intermediaries,consolidating shipments to gain lower rates for their customers.

Question 76

Large facilities offer economies of scale in facilities and materials handling systems; per-unit costs for these systems decrease as volume increases.

Question 77

Unitizing combines as many packages as possible into each load that moves within or outside a facility.

Question 78

Standardized modular shipping containers maximize savings by limiting loading,unloading,and other handling.

Question 79

Motor carriers concentrate on shipping raw materials while railroads typically haul bulk shipments of manufactured products.

Question 80

A multimodal firm provides intermodal service through external transportation resources.