Question 1

On your first day as the new operations manager for a major toy manufacturer, you take a look at how raw materials are handled. The manufacturing plant keeps close to 500,000 types of tiny parts on hand, ready for assembly. To ensure that workers are able to easily locate, inventory, and retrieve these parts, as well as finished goods, you've decided the company needs ______ to keep production at its peak.

Accepted Answer

A)   a cold-storage warehouse
B)   a distribution warehouse
C)   an automated warehouse
D)   a storage warehouseE) A) and B)
F) B) and C)

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

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

Accepted Answer

A) True 
 B)False

Question 4

You're the marketing director for a company that manufactures customized mining equipment used to extract fairly rare precious metals like iridium, palladium, and rhodium from the earth. You have chosen to create a fairly short distribution channel because:

Accepted Answer

A)   a long channel would diminish your profit margins without offering any benefits.
B)   there are so few customers for your product that you can manage your own sales efforts within the company.
C)   it is challenging to deliver the kind of highly specialized equipment you manufacture to remote locations.
D)   your customers are located all over the world.E) All of the above
F) None of the above

Question 5

John works for an ice-cream manufacturer. His department focuses on keeping the finished products fresh as well as ensuring that they reach the retailers on time as the products are highly perishable. In addition, his department decides on which flavors of ice cream should be sent to which retailers in various trade areas. John is most likely involved with:

Accepted Answer

A)   reverse management.
B)   horizontal integration.
C)   downstream management.
D)   backward integration.E) All of the above
F) A) and D)

Question 6

Conflicts resulting from disagreements among channel members at the same level, such as two or more wholesalers or two or more retailers, or among marketing intermediaries of the same type are called _____ conflicts.

Accepted Answer

A)   exclusive
B)   vertical
C)   horizontal
D)   cross-channelE) C) and D)
F) A) and B)

Question 7

Describe the factors that influence a firm's choice of a marketing channel strategy.

Accepted Answer

The factors that influence a firm's choice of a marketing channel strategy are:
1. Market factors: Business purchasers usually prefer to deal directly with manufacturers, but most consumers make their purchases from retailers. Marketers often sell products that serve both business users and consumers through more than one channel.
2. Product factors: Perishable goods, trendy or seasonal fashions, complex products, such as custom-made installations and computer equipment, move through short channels. In general, relatively standardized items that are also nonperishable with low unit cost pass through comparatively long channels.
3. Organizational and competitive factors: Companies with strong financial, management, and marketing resources feel less need for help from intermediaries. A large, financially strong manufacturer can hire its own sales force, warehouse its own goods, and extend credit to retailers or consumers. But a small firm with fewer resources may do better with the aid of intermediaries. The manufacturer's desire for control over marketing its products also influences channel selection.
4. Competitive factors: Marketers sometimes choose distribution channels to either avoid competitors or compete with them head-to-head. Sometimes businesses will only work with distributors who offer exclusivity, meaning they will not carry a competitor's line. In many categories, this is not possible, as wholesalers often carry most major brands so that they can provide the best assortment to their retail customers.
Businesses that explore new distribution channels must be careful to avoid upsetting their channel intermediaries. Distribution channels work smoothly only when members cooperate in well-organized efforts to achieve maximum operating efficiencies. Two types of conflict - horizontal and vertical - can hinder the normal functioning of a distribution channel.
5. Intensity factors: Another key channel strategy decision is the intensity of distribution. Distribution intensity refers to the number or percentage of intermediaries (usually retailers) through which a manufacturer distributes its goods in a particular market. Optimal distribution intensity should ensure adequate market coverage for a product. Adequate market coverage varies depending on the goals of the individual firm, the type of product, and the consumer segments in its target market. In general, distribution intensity varies along a continuum with three general categories: intensive distribution, selective distribution, and exclusive distribution.

Question 8

Which of the following modes of transportation controls the largest share of the freight business as measured by ton-miles?

Accepted Answer

A)   Railroads
B)   Water carriers
C)   Motor carriers
D)   PipelinesE) A) and B)
F) A) and C) A

Question 9

Compare and contrast wholesalers and agents.

Accepted Answer

Wholesalers are channel intermediaries t...

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

You're the production manager for a company that manufactures clothing, and you oversee activities in a wide range of departments from cutting and stitching to warehousing and shipping. Maintaining a steady flow of goods through production is essential, so if you could employ any supply chain management system to make your job easier, which of the following would you choose?

Accepted Answer

A)   RFID, a tool that requires placing a tiny tracking chip on all materials
B)   ERP, an integrated software that consolidates sequencing and scheduling data from all units
C)   Logistical cost control, a method of evaluating how to add value for your customers through logistical changes
D)   Value chain management, a means of managing the complete sequence of suppliers and activities that contribute to the creation and delivery of goodsE) A) and C)
F) A) and D)

Question 12

Which of the following is NOT typically moved through a short distribution channel?

Accepted Answer

A)   Heavy-duty construction equipment
B)   Manicures and pedicures
C)   Pediatric healthcare
D)   Imported women's shoesE) A) and C)
F) None of the above

Question 13

You're the production manager for Blue Ribbon Bakery, and you're responsible for managing the inventory of all of the flour, eggs, milk, butter, and other raw materials that go into the company's baked goods. Storing all of these raw materials, some of which require refrigeration, can get expensive so you don't like to go overboard on ordering them, but on the other hand you have to make sure the bakery workers have what they need. Which of the following methods of inventory control do you think will work best at Blue Ribbon?

Accepted Answer

A)   Stock two days' worth of raw materials, and only re-order when the current inventory has been used up
B)   Stock only as much raw material as you expect to use in the next three working days to ensure workers have just what they need, and closely monitor the flow of incoming materials to ensure you always have three days' worth
C)   Stock as much raw material as you expect to use in the next two weeks to ensure workers have what they need plus a little more
D)   Stock as much raw material as possible to ensure that workers always have more than enough to work withE) A) and C)
F) All of the above

Question 14

You're responsible for keeping track of inventory for a huge, national chain of bookstores, which is challenging since thousands of products are constantly being delivered, stocked, sold, and transferred through your stores. So, if you could employ any supply chain management system to make your job easier, which of the following would you choose?

Accepted Answer

A)   RFID, a tool that requires placing a tiny tracking chip on all materials
B)   ERP, an integrated software that consolidates data from all of your stores
C)   Logistical cost control, a method of evaluating how to add value for your customers through logistical changes
D)   Value chain management, a means of managing the complete sequence of suppliers and activities that contribute to the delivery of goodsE) B) and C)
F) A) and D)

Question 15

You're finding your new job as the marketing manager for highly specialized medical equipment to be very challenging. Relatively few medical practices and hospitals across the country need your product, and it's tough to determine who the decision makers are. Which type of distribution channel will work best for your objectives, and why?

Accepted Answer

A)   Due to the wide geographic range of your potential customers, you will need to set up a long distribution channel with many intermediaries who can facilitate the exchange process.
B)   Because you are selling in the B2B environment with relatively few business purchasers, a short distribution channel works best for your needs.
C)   Since you are selling physical products that need to be warehoused and delivered, you will need a long distribution channel with multiple logistics intermediaries.
D)   Because of the challenges involved in identifying potential customers, you will need to engage the services of several sales and marketing intermediaries who can assist you.E) A) and C)
F) A) and B) B

Question 16

_____ refers to the movement of products through more than one channel to reach the firm's target market.

Accepted Answer

A)   Direct channeling
B)   Dual distribution
C)   Selective channeling
D)   Exclusive distributionE) A) and D)
F) All of the above

Question 17

Discuss the concept of protective packaging and materials handling.

Accepted Answer

A materials handling system is a set of ...

Question 18

People love celebrity gossip, which is what makes your Hollywood insider magazine so popular. That's why your product is sold in a wide range of outlets, from bookstores to drugstores and convenience stores to outdoor kiosks. As the marketing director for the magazine, you've set up a fairly long distribution channel because:

Accepted Answer

A)   it is more cost effective to use intermediaries to develop and maintain contacts with such a diversified group of customers.
B)   it's just easier to let someone else figure out the logistics of storing and delivering the product.
C)   your product has a very short shelf life and needs to be delivered to customers quickly.
D)   your customers are centrally located in a concentrated geographic area.E) B) and D)
F) None of the above

Question 19

Which of the following components in the supply chain of a manufacturing company are most concerned with speed and timeliness?

Accepted Answer

A)   Inbound logistics, outbound logistics
B)   Production, customer service
C)   Inbound logistics, production, customer service
D)   Inbound logistics, outbound logistics, productionE) B) and D)
F) A) and B)

Question 20

As the marketing director for a tablet computer manufacturer, you're aware that some consumers still need a lot of help and information before making a decision to buy a tablet, while others are familiar with tablet computers and know exactly what they're looking for in a product. With this objective in mind, which distribution channel makes the most sense for marketing your products?

Accepted Answer

A)   Dual distribution, involving direct online sales and intermediary sales through electronics retailers
B)   A marketing intermediary, specifically electronics retailers
C)   A direct channel, specifically a company-run e-commerce website
D)   A reverse channel involving recycling capabilitiesE) B) and D)
F) A) and C)

Exam 15: Distribution Channels and Supply Chain Management

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

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

Correct Answer
verified

You're the marketing director for a company that manufactures customized mining equipment used to extract fairly rare precious metals like iridium, palladium, and rhodium from the earth. You have chosen to create a fairly short distribution channel because:

Correct Answer
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Correct Answer
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Conflicts resulting from disagreements among channel members at the same level, such as two or more wholesalers or two or more retailers, or among marketing intermediaries of the same type are called _____ conflicts.

Correct Answer
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Describe the factors that influence a firm's choice of a marketing channel strategy.

Which of the following modes of transportation controls the largest share of the freight business as measured by ton-miles?

Correct Answer
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A

Compare and contrast wholesalers and agents.

Correct Answer
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Wholesalers are channel intermediaries t...
View Answer

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

Correct Answer
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Correct Answer
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Which of the following is NOT typically moved through a short distribution channel?

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B

_____ refers to the movement of products through more than one channel to reach the firm's target market.

Correct Answer
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Discuss the concept of protective packaging and materials handling.

Correct Answer
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A materials handling system is a set of ...
View Answer

Correct Answer
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Which of the following components in the supply chain of a manufacturing company are most concerned with speed and timeliness?

Correct Answer
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Correct Answer
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Exam 15: Distribution Channels and Supply Chain Management

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

You're the marketing director for a company that manufactures customized mining equipment used to extract fairly rare precious metals like iridium, palladium, and rhodium from the earth. You have chosen to create a fairly short distribution channel because:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Conflicts resulting from disagreements among channel members at the same level, such as two or more wholesalers or two or more retailers, or among marketing intermediaries of the same type are called _____ conflicts.

Correct AnswerverifiedShow Answer

Describe the factors that influence a firm's choice of a marketing channel strategy.

Which of the following modes of transportation controls the largest share of the freight business as measured by ton-miles?

Correct AnswerverifiedA

Compare and contrast wholesalers and agents.

Correct AnswerverifiedWholesalers are channel intermediaries t...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is NOT typically moved through a short distribution channel?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedB

_____ refers to the movement of products through more than one channel to reach the firm's target market.

Correct AnswerverifiedShow Answer

Discuss the concept of protective packaging and materials handling.

Correct AnswerverifiedA materials handling system is a set of ...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Which of the following components in the supply chain of a manufacturing company are most concerned with speed and timeliness?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
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A

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Wholesalers are channel intermediaries t...
View Answer

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B

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A materials handling system is a set of ...
View Answer

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