8/20/2019 Kotler Chapter 12 MCQ

Chapter 12 Marketing Channels: Delivering Customer Value

1) Which of the following is NOT a typical supply chain member?

A) resellers
B) customers

C)
) intermediaries
go!ernment agencies
") raw materials supplier 
Answer# 
iff# 1 $age %ef# &&'
(ill# Concept
Ob*ecti!e# 1+,1

+) -------- the manufacturer or ser!ice pro!ider is the set of firms that supply the raw
materials. components. parts. information. finances. and e/pertise needed to create a product or
ser!ice0

A) ownstream
B) pstream from
from
C) (eparated from
) Congruous to
") $arallel with
Answer# B
iff# + $age %ef# &&'
(ill# Concept
Ob*ecti!e# 1+,1

&) Another term for the supply chain that suggests a sense and respond !iew of the maret is

 --------0
A) supply and demand chain
B) demand chain
C) channel of distribution
) distribution channel
") physical distribution
Answer# B
iff# & $age %ef# &&2
(ill# Concept
Ob*ecti!e# 1+,1

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7) When suppliers. distributors. and customers partner with each other to impro!e the
 performance of the entire system. they are participating in a --------0
A) !alue deli!ery networ 
B) channel of distribution
C) supply chain

) demand
") all of thechain
abo!e
Answer# A
iff# 1 $age %ef# &&2
(ill# Concept
Ob*ecti!e# 1+,1

8) 9ost producers today sell their goods to --------0

A) final users
B) final users and mareting members
C) intermediaries
) the go!ernment at !arious le!els
") competitors
Answer# C
iff# + $age %ef# &&:
(ill# Concept
Ob*ecti!e# 1+,1

;) A company<s channel decisions directly affect e!ery --------0

A) channel member 
B) mareting decision
C) customer<s choices
) employee in the channel
") competitor<s actions
Answer# B
iff# + $age %ef# &&:
(ill# Concept
Ob*ecti!e# 1+,1

') istribution channel decisions often in!ol!e -------- with other firms. particularly those that
in!ol!e contracts or relationships with channel partners0
A) short,term commitments
B) long,term commitments
C) ma*or problems
) financial losses
") disagreements
Answer# B
iff# & $age %ef# &&:
(ill# Concept
Ob*ecti!e# 1+,1

+1+
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2) =oe Blanco. lie other producers. has disco!ered that his intermediaries usually offer his firm
more than it can achie!e on its own0 Which of the following is most liely an ad!antage that =oe
creates by woring with intermediaries?
A) financial support
B) fast ser!ice

C)
) scale of operation
woring relationships with foreign distributors
") promotional assistance
Answer# C
iff# + $age %ef# &&:
(ill# Concept
Ob*ecti!e# 1+,1

:) >rom the economic system<s point of !iew. the role of mareting intermediaries is to transform
the assortment of products made by producers into the assortment of products wanted by
 --------0
A) channel members
B) distributors
C) consumers
) manufacturers
") mareters
Answer# C
iff# + $age %ef# &74
(ill# Concept
Ob*ecti!e# 1+,1

14) $roducers benefit from using intermediaries because they --------0

A) offer greater efficiency in maing goods a!ailable to target marets
B) bring a fresh point of !iew to strategy de!elopment
C) eliminate ris 
) are generally baclogged with orders
") refuse to store products for longer than a few days
Answer# A
iff# & $age %ef# &&:
(ill# Concept
Ob*ecti!e# 1+,1

11) 5ntermediaries play an important role in matching --------0

A) dealer with customer 
B) supply and demand
C) product to region
) manufacturer to product
") information and promotion
Answer# B
iff# + $age %ef# &74
(ill# Concept
Ob*ecti!e# 1+,1

+1&
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1+) Channel members add !alue by bridging the ma*or gaps of -------- that separate goods and
ser!ices from those who would use them0
A) time. place. and form
B) place. possession. and form
C) time. place. and possession

) place. need.
") place. time. and
and distribution
need
Answer# C
iff# + $age %ef# &74
(ill# Concept
Ob*ecti!e# 1+,1

1&) Which of the following is NOT a ey function that intermediaries play in completing
transactions?
A) promotion
B) information
C) matching
) financing
") negotiation
Answer# "
iff# & $age %ef# &74
(ill# Concept
Ob*ecti!e# 1+,1

17) Which of the following is NOT a ey function that intermediaries play in helping to fulfill a
completed transaction?
A) physical distribution
B) promotion
C) financing
) ris taing
") storing goods
Answer# B
iff# & $age %ef# &74
(ill# Concept
Ob*ecti!e# 1+,+

18) 5n mareting terms. we say that the number of intermediary le!els indicates the -------- of
a channel0
A) depth
B) comple/ity
C) in!ol!ement
) length
") width
Answer# 
iff# 1 $age %ef# &71
(ill# Concept
Ob*ecti!e# 1+,1

+17
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1;) To a producer of goods. a greater number of channel le!els means -------- and greater
channel comple/ity0
A) less distance between producer and end consumer 
B) less control
C) more potential ideas

) higherchannel
") fewer ta/es partners
Answer# B
iff# + $age %ef# &71
(ill# Concept
Ob*ecti!e# 1+,1

1') All of the institutions in a channel are connected by !arious flows0 These include physical
flow. flow of ownership. payment flow. information flow. and -------- flow0
A) promotion
B) acuisition
C) customer 
) return product
") by,product
Answer# A
iff# & $age %ef# &71
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,1

12) A distribution channel is more than a collection of firms connected by !arious flows@ it is
an) -------- in which people and companies interact to accomplish indi!idual. company. and
channel goals0
A) added !alue chain
B) comple/ beha!ioral system
C) corporate mareting system
) !ertical mareting system
") multichannel system
Answer# B
iff# + $age %ef# &7+
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,+

+18
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1:) An ad!antage of a channel of distribution o!er selling direct to consumers is that each
channel member plays a -------- in the channel0
A) time,sa!ing part
B) specialied role
C) decisional role

) informational
") disciplinary role
role
Answer# B
iff# + $age %ef# &7+
(ill# Concept
Ob*ecti!e# 1+,+

+4) -------- conflict. which occurs between different le!els of the same channel. is more
common than -------- conflict. which occurs among firms at the same le!el of the channel0
A) 6oriontal@ !ertical
B) ertical@ horiontal

C)
) Contractual@ corporate
Corporate@ franchise
") Wholesaler@ retailer 
Answer# B
iff# + $age %ef# &7+
(ill# Concept
Ob*ecti!e# 1+,+

+1) 6istorically. con!entional channels ha!e laced the leadership to --------0

A) assign channel member roles and attain efficiency
B) attain efficiency and assign member roles
C) assign member roles and manage conflict
) set standard pricing and promotions
") set standard pricing and pacaging
Answer# C
iff# & $age %ef# &7&
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,+

++) A con!entional distribution channel consists of one or more -------- producers.

wholesalers. and retailers0
A) product,related
B) independent
C) contract
) estranged
") merchant
Answer# B
iff# + $age %ef# &77
(ill# Concept
Ob*ecti!e# 1+,+

+1;
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+&) A channel consisting of one or more independent producers. wholesalers. or retailers that
see to ma/imie their own profits e!en at the e/pense of profits for the channel as a whole is
 

an) --------0
A) !ertical mareting system
B) con!entional distribution channel

C)
) independent
corporate 9(channel allocation
") administered !ertical mareting system
Answer# B
iff# + $age %ef# &77
(ill# Concept
Ob*ecti!e# 1+,+

+7) An ad!antage of a !ertical mareting system 9() is that it acts as a -------- system0
A) unified
B) more efficient

C)
) modern
customer,dri!en
") tas,dri!en
Answer# A
iff# & $age %ef# &77
(ill# Concept
Ob*ecti!e# 1+,+

+8) A corporate 9( has the ad!antage of controlling the entire distribution chain under
 --------0
A) a profit,ma/imiing strategic plan
B) single ownership
C) mass distribution
) a few intermediaries
") little control
Answer# B
iff# 1 $age %ef# &77
(ill# Concept
Ob*ecti!e# 1+,+

+;) Which of the following are the three ma*or types of !ertical mareting systems?
A) corporate. contractual. and chain
B) contractual. corporate. and independent
C) contractual. corporate. and administered
) administered. independent. and franchised
") contractual. corporate. and tas 
Answer# C
iff# + $age %ef# &77
(ill# Concept
Ob*ecti!e# 1+,+

+1'
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+') A distinguishing feature of a contractual 9( is that coordination and conflict management
among the independent members of the channel are attained through --------0
A) agents and broers
B) woring partnerships
C) limited liability incorporation

) contractual
") natural agreements
competiti!e forces
Answer# 
iff# 1 $age %ef# &78
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,+

+2) The most common type of contractual agreement in business is the --------0
A) franchise organiation
B) !ertical mareting system

C)
) con!entional
corporate 9(mareting channel
") administered 9(
Answer# A
iff# & $age %ef# &78
(ill# Concept
Ob*ecti!e# 1+,+

+:) Deadership in which type of mareting system is assumed not through common ownership or 
contractual ties but through the sie and power of one or a few dominant channel members?
A) horiontal mareting system
B) administered 9(
C) corporate 9(
) multichannel distribution system
") con!entional mareting channel
Answer# B
iff# + $age %ef# &78
(ill# Concept
Ob*ecti!e# 1+,+

&4) 5n a --------. two or more companies at one le!el *oin together to de!elop a new mareting
opportunity0
A) franchise
B) horiontal mareting system
C) corporate 9(
) multichannel distribution system
") con!entional distribution channel
Answer# B
iff# 1 $age %ef# &78
(ill# Concept
Ob*ecti!e# 1+,+

+12
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&1) 6ybrid mareting systems are also called --------0

A) dual distribution systems
B) multichannel distribution systems
C) administered franchises
) horiontal multichannel systems

") contractual
Answer# B mareting systems
iff# + $age %ef# &7;
(ill# Concept
Ob*ecti!e# 1+,+

&+) As mareting manager for Elobe 5mports and "/ports. you want to start reaping the benefits
of a multichannel distribution system0 Fou will liely en*oy all of the following "GC"$T which
one?
A) e/panded sales
B) e/panded maret co!erage

C)
) selling at a higher
opportunities grossproducts
to tailor margin and ser!ices to the needs of di!erse segments
") A and C
Answer# C
iff# & $age %ef# &7;
(ill# Concept
Ob*ecti!e# 1+,+

&&) The use of multichannel systems in the nited (tates is --------0

A) decreasing
B) increasing
C) holding steady
) spreading abroad fast
") declining abroad
Answer# B
iff# + $age %ef# &7;
(ill# Concept
Ob*ecti!e# 1+,+

&7) The ma*or disad!antage of a multichannel system is that it is harder to control and it can
generate --------0
A) channel conflict
B) less net profit
C) fewer domestic sales
) inefficiencies
") declining employee morale
Answer# A
iff# + $age %ef# &7;
(ill# Concept
Ob*ecti!e# 1+,+

+1:
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&8) ue in a large part to ad!ances in technology. -------- is a ma*or trend whereby product
and ser!ice producers are bypassing intermediaries and going directly to final buyers. or
radically new types of channel intermediaries are emerging to displace traditional ones0
A) the !ertical mareting system
B) the corporate mareting system

C)
) disintermediation
the corporate merger 
") the hostile taeo!er 
Answer# C
iff# + $age %ef# &7'
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,+

&;) 5n many industries. traditional intermediaries are dropping by the wayside because of
changes in -------- and the growth of -------- mareting0

A) federal
B) state andlaws@
localbusiness,to,business
laws@ target
C) franchise structure@ independent
) technology@ direct and online
") channel design@ retail
Answer# 
iff# + $age %ef# &7'
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,+

&') esigning a channel system calls for analying consumer needs. setting channel ob*ecti!es.
 -------- and e!aluation0
A) establishing a budget
B) identifying ma*or channel alternati!es
C) seeing regulatory appro!al
) seeing legal ad!ice
") measuring ob*ecti!es
Answer# B
iff# + $age %ef# &72
(ill# Concept
Ob*ecti!e# 1+,&

++4
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&2) Which of the following should be the first step in designing a mareting channel?
A) identifying channel ob*ecti!es
B) identifying what consumers want from the channel
C) analying channel alternati!es
) e!aluating intermediaries

") e/ploring
Answer# B international opportunities
iff# + $age %ef# &7:
(ill# Concept
Ob*ecti!e# 1+,&

&:) To increase a channel<s ser!ice le!el. it must pro!ide a greater assortment of products. more
add,on ser!ices. and --------0
A) lower prices
B) more efficiency
C) faster deli!ery

) better terms
") follow,up
Answer# C
iff# & $age %ef# &7:
(ill# Concept
Ob*ecti!e# 1+,&

74) Companies should state their channel ob*ecti!es in terms of targeted le!els of --------0
A) co,op ad!ertising
B) efficiency
C) customer ser!ice
) conflict reduction
") profitability
Answer# C
iff# + $age %ef# &84
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,&

71) When a company is identifying its ma*or channel alternati!es. it should consider its choices
in terms of types. number. and -------- of intermediaries0
A) sie
B) power 
C) responsibilities
) capacity
") none of the abo!e
Answer# C
iff# + $age %ef# &84
(ill# Concept
Ob*ecti!e# 1+,&

++1
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7+) Which type of product might reuire a more direct mareting channel to a!oid delays and too
much handling?
A) lower,priced products
B) perishable products
C) high,priced products

) products in
") products in their
their decline
maturitystage
stage
Answer# B
iff# + $age %ef# &84
(ill# Concept
Ob*ecti!e# 1+,&

7&) When determining the number of channel members to use at each le!el. three strategies are
a!ailable# intensi!e. e/clusi!e. and -------- distribution0
A) multichannel
B) selecti!e

C)
) international
direct
") e/tensi!e
Answer# B
iff# 1 $age %ef# &84
(ill# Concept
Ob*ecti!e# 1+,&

77) (ometimes a producer chooses only a few dealers in a territory to distribute its products or
ser!ices0 Eenerally these dealers are gi!en a right to -------- distribution0
A) e/clusi!e
B) selecti!e
C) intensi!e
) administered
") corporate
Answer# A
iff# 1 $age %ef# &81
(ill# Concept
Ob*ecti!e# 1+,&

78) Which type of distribution is used when the producer wants more than one. but fewer than
all. of the intermediaries who are willing to carry its products?
A) e/clusi!e
B) selecti!e
C) intensi!e
) administered
") corporate
Answer# B
iff# 1 $age %ef# &81
(ill# Concept
Ob*ecti!e# 1+,&

+++
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7;) When establishing the responsibilities of channel members. the producer establishes a list
 price. sets discounts for intermediaries. and defines each channel member<s --------0
A) sales !olume
B) territory
C) legal rights

) customers
") mission
Answer# B
iff# + $age %ef# &81
(ill# Concept
Ob*ecti!e# 1+,&

7') Channel members should be e!aluated using all of the following criteria "GC"$T which
one?
A) economic factors
B) control

C)
) adapti!e criteria
channel leadership
") none of the abo!e
Answer# 
iff# & $age %ef# &81
(ill# Concept
Ob*ecti!e# 1+,&

72) When a company compares the liely sales. costs. and profitability of different channel
alternati!es. it is using -------- criteria to e!aluate its channel options0
A) selecti!e
B) adapti!e
C) economic
) control
") distribution
Answer# C
iff# + $age %ef# &81
(ill# Concept
Ob*ecti!e# 1+,&

++&
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7:) 5t is common for international mareters to -------- their channel strategies for each
country0
A) e/tend
B) adapt
C) restrict

) see appro!al for 

") eliminate
Answer# B
iff# 1 $age %ef# &8+
AAC(B# 9ulticultural and i!ersity
(ill# Concept
Ob*ecti!e# 1+,&

84) China and 5ndia each contain more than one billion people0 6owe!er. companies can access
only a small percentage of these potential marets due to --------0
A) inadeuate distribution systems

B)
C) indifference
high regionaltoward
ta/es Western products
) the religious caste system
") insurmountable language barriers
Answer# A
iff# & $age %ef# &8+
AAC(B# 9ulticultural and i!ersity
(ill# Concept
Ob*ecti!e# 1+,&

81) 9areting channel management calls for selecting. managing. --------. and e!aluating
channel members o!er time0
A) reducing conflict
B) reducing waste
C) moti!ating
) pruning
") all of the abo!e
Answer# C
iff# + $age %ef# &8+
(ill# Concept
Ob*ecti!e# 1+,7

++7
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8+) A company should thin of its intermediaries as both its -------- and --------0
A) competitors@ partners
B) customers@ partners
C) competitors@ mareters
) customers@ employees

") competitors@
Answer# B customers
iff# + $age %ef# &8&
(ill# Concept
Ob*ecti!e# 1+,7

8&) 9ost companies practice strong $%9 to forge long,term relationships with channel
members0 What does $%9 stand for?
A) primary relationship management
B) potential relationship management
C) perennial relationship management
) partner relationship management
") personnel roster maintenance
Answer# 
iff# 1 $age %ef# &8&
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,7

87) (ometimes a seller reuires its dealers to abstain from handling competitors< products in an
arrangement called --------0
A) e/clusi!e distribution
B) e/clusi!e dealing
C) selecti!e distribution
) e/clusi!e pricing
") disintermediation
Answer# B
iff# + $age %ef# &8;
AAC(B# "thical %easoning
(ill# Concept
Ob*ecti!e# 1+,7

++8
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88) "/clusi!e dealing is legal as long as it does not -------- or tend to create a monopoly and
as long as both parties enter into the agreement --------0
A) substantially lessen competition@ coerci!ely
B) restrict trade@ for a cause
C) substantially lessen competition@ !oluntarily

) interfere
") create with competitors@
a smaller forcefully
maret@ permanently
Answer# C
iff# & $age %ef# &8;
AAC(B# "thical %easoning
(ill# Concept
Ob*ecti!e# 1+,7

8;) "/clusi!e territorial agreements are normal in --------0

A) !ertical mareting systems
B) franchises

C)
) integrated
horiontal mareting
mareting systems
systems
") supply chain management
Answer# B
iff# + $age %ef# &8;
AAC(B# "thical %easoning
(ill# Concept
Ob*ecti!e# 1+,7

8') 5f the producer of a strong brand agrees to sell its brand to a dealer only if the dealer will tae
some or all of the rest of the line. the result is --------0
A) e/clusi!e distribution
B) e/clusi!e dealing
C) always illegal
) a tying agreement
") disintermediation
Answer# 
iff# + $age %ef# &8;
AAC(B# "thical %easoning
(ill# Concept
Ob*ecti!e# 1+,7

++;
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82) 9areting logistics in!ol!es getting the right product to the right customer in the right place
at the right time0 Which one of the following is NOT included in this process?
A) planning the physical flow of goods and ser!ices
B) implementing the plan for the flow of goods and ser!ices
C) controlling the physical flow of goods. ser!ices. and information

) gathering
") A and C customer<s ideas for new products
Answer# 
iff# 1 $age %ef# &8;
(ill# Concept
Ob*ecti!e# 1+,8

8:) 9areting logistics in!ol!es which of the following distribution flows?

A) outbound and inbound
B) outbound. inbound. and re!erse
C) inbound and re!erse

) outbound and re!erse

") outbound
Answer# B
iff# + $age %ef# &8;
(ill# Concept
Ob*ecti!e# 1+,8

;4) Which of the following is NOT an area of responsibility for a logistics manager?
A) information systems
B) warehousing
C) mareting
) in!entory
") purchasing
Answer# C
iff# + $age %ef# &8;,&8'
(ill# Concept
Ob*ecti!e# 1+,8

;1) Which of the following inno!ations has created opportunities for significant gains in
distribution efficiency?
A) tying agreements
B) Web,based logistics systems
C) partner relationship management
) contractual !ertical mareting systems
") storage warehouses
Answer# B
iff# + $age %ef# &8'
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,8

++'
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;+) The goal of mareting logistics should be to pro!ide a -------- le!el of customer ser!ice at
the least cost0
A) ma/imum
B) targeted
C) moderate

) minimum
") competiti!e
Answer# B
iff# + $age %ef# &8'
(ill# Concept
Ob*ecti!e# 1+,8

;&) The difference between distribution centers and storage warehouses is that the former are
designed to --------0
A) store goods for longer periods
B) hold larger !olumes

C)
) mo!e goods
primarily be rather
ownedthan *ustmanufacturer 
by the store them
") be automated
Answer# C
iff# + $age %ef# &82
(ill# Concept
Ob*ecti!e# 1+,8

;7) To reduce in!entory management costs. many companies use a system called --------.
which in!ol!es carrying only small in!entories of parts or merchandise. often only enough for a
few days of operation0
A) reduction,in!entory management
B) *ust,in,time logistics
C) limited in!entory logistics
) supply chain management
") economic order uantity
Answer# B
iff# + $age %ef# &8:
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,8

++2
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;8) Through the use of --------. or Hsmart tagH technology. a company is able to locate e/actly
where a product is within the supply chain0
A) %>5
B) $%9
C) 9(

) 5T
") &$D
Answer# A
iff# + $age %ef# &8:
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,8

;;) Which of the following transportation modes is used for digital products?
A) trucs
B) rail

C)
) the
air  5nternet
") ship
Answer# C
iff# 1 $age %ef# &8:
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,8

;') 5n choosing a transportation mode for a product. shippers must balance the considerations of
speed. dependability. cost. and --------0
A) weight
B) customer choice
C) a!ailability
) distance
") company reputation
Answer# C
iff# & $age %ef# &;4
(ill# Concept
Ob*ecti!e# 1+,8

++:
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;2) 5n the proper order. identify the correct terms for these intermodal transportation
combinations# rail and truc. water and truc. water and rail0
A) fishybac@ airtruc@ trainship
B) piggybac@ airtruc@ fishybac 
C) trainship@ fishybac@ piggybac 

) piggybac@ fishybac@
") piggybac. fishybac@ birdybac 
trainship
Answer# 
iff# + $age %ef# &;4
(ill# Concept
Ob*ecti!e# 1+,8

;:) Companies manage their supply chains through --------0

A) silled operators
B) information
C) the 5nternet
) transportation modes
") competitors
Answer# B
iff# + $age %ef# &;4
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,8

'4) sing --------. retailers can share real,time data on sales and current in!entory le!els with
suppliers who tae responsibility for ordering and deli!ering products to retailers. thereby sa!ing
time and money0
A) dual distribution modes
B) continuous in!entory replenishment systems
C) the 5nternet
) their own trucing and distribution systems
") integrated distribution
Answer# B
iff# + $age %ef# &;1
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,8

+&4
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'1) Dancaster Bo/ Company wants to pro!ide better customer ser!ice while trimming
distribution costs through teamwor. both inside the company and among all the mareting
channel organiations0 Dancaster Bo/ is thining of --------0
A) integrated logistics management
B) supply chain management

C)
) customer
horiontalrelationship management
mareting system
") disintermediation
Answer# A
iff# + $age %ef# &;1
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,8

'+) What is the goal of integrated supply chain management?

A) to reduce costs
B) to increase ser!ices with minimal cost through teamwor 
C) to harmonie all of the company<s logistics decisions
) to reduce conflict and increase cooperation among channel members
") all of the abo!e
Answer# "
iff# & $age %ef# &;1
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,8

'&) (mart companies coordinate their logistics strategies and forge strong partnerships with
suppliers and customers to impro!e customer ser!ice and reduce channel costs through
 --------0
A) cross,functional teams
B) cross,company teams
C) partnering
) cross,functional. cross,company teams
") segregated departmentaliation
Answer# 
iff# & $age %ef# &;+
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,8

+&1
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'7) The success of each channel member depends on the performance of --------0
A) ey channel members
B) the entire supply chain
C) the channel captain
) the manufacturer 

") the wholesaler 

Answer# B
iff# + $age %ef# &;+
(ill# Concept
Ob*ecti!e# 1+,8

'8) Today. a growing number of firms now outsource some or all of their logistics to --------0
A) cross,functional teams
B) disintermediaries
C) channel members
) third,party logistics pro!iders

") competitors
Answer# 
iff# 1 $age %ef# &;+
(ill# Concept
Ob*ecti!e# 1+,8

';) 5n designing its mareting channel. Chairs for "!ery Occasion has mo!ed from a mae,and,
sell !iew of its business. which focused on producti!e inputs and factory capacity as a starting
 point for mareting planning. to a sense,and respond !iew. which begins instead with the needs
of target customers0 With this new !iew. Chairs for "!ery Occasion is de!eloping its --------0
A) supply chain
B) wholesaler chain
C) demand chain
) logistics
") !ertical mareting system
Answer# C
iff# & $age %ef# &&2
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,1

+&+
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'') $roud $ets. a producer of clothing and accessories for pets. has recently partnered with a
regional chain of pet stores0 Which of the following would $roud $ets be D"A(T liely to e/pect
from its new channel member?
A) promoting its products through ad!ertising
B) assembling and pacaging its products for final sale

C)
) distributing rele!ant
identifying raw mareting
materials research
and other information
producti!e inputs
") negotiating on its products< prices
Answer# 
iff# + $age %ef# &74
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,1

'2) (te!e<s $hysco (ates sells its products to Wal,9art. who then sells them to the consumer0
This is an e/ample of an) --------0

A) direct mareting
B) producer channelchannel
C) indirect mareting channel
) retailer channel
") corporate !ertical mareting system
Answer# C
iff# 1 $age %ef# &71
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

':) =oanie Cal!ert is e/periencing a disagreement with intermediaries in the channel o!er who
should do what and for what rewards0 =oanie is e/periencing --------0
A) channel delusion
B) channel conflict
C) channel disintermediation
) channel mismanagement
") channel intermediation
Answer# B
iff# 1 $age %ef# &7+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

+&&
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24) When two Taco Bell restaurants ha!e a disagreement o!er who should be able to sell in
uantity at a discount to the local high school band. they are in a -------- conflict0
A) !ertical
B) problematic
C) no,win

) horiontal
") functional
Answer# 
iff# + $age %ef# &7+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

21) (taples Office (upply opened an online store that created competition with many of its
dealers0 The corporate office created a -------- conflict0
A) !ertical

B)
C) problematic
no,win
) horiontal
") intermediation
Answer# A
iff# + $age %ef# &7+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

2+) Which of the following is an e/ample of horiontal channel conflict?

A) managers of two separate 6oliday 5nns disagreeing o!er what constitutes poor ser!ice
B) nited Airlines competing with Northwest Airlines for customers
C) disgruntled factory worers complaining about a small pay raise
) the B9W dealership in >ort Wayne complaining that the B9W dealership in 5ndianapolis is
situated too close
") A and 
Answer# "
iff# & $age %ef# &7+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

+&7
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2&) Which of the following is an e/ample of a manufacturer,sponsored retailer franchise system?

A) fast,food restaurants such as 9conald<s and Burger Iing
B) (tarbucs operating within Target stores
C) >ord and its networ of independent franchised dealers
) licensed bottlers that bottle and sell Coca,Cola to retailers

") motelsCsuch as 6oliday 5nn and %amada 5nn

Answer#
iff# & $age %ef# &78
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,+

27) When 9conald<s offers its products inside of a Wal,9art store. it is following a --------0
A) con!entional distribution channel
B) corporate 9(
C) contractual 9(

) administered
") horiontal 9( system
mareting
Answer# C
iff# & $age %ef# &78
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

28) Which of the following is an e/ample of a multichannel distribution system?

A) Wal,9art locating to se!eral countries
B) =0 C0 $enney<s catalog and retail store sales
C) A!on<s door,to,door distribution
) (tarbuc<s location inside of boo stores
") a hotel pro!iding guest pri!ileges at a health spa across the street
Answer# B
iff# + $age %ef# &7;
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

+&8
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2;) Blocbuster offers  rentals through its Total Access online rental ser!ice and through its
 brics,and,mortar stores0 This is an e/ample of an)--------0
A) contractual 9(
B) administered 9(
C) horiontal mareting system

) con!entional distribution
") multichannel distribution system
channel
Answer# "
iff# 1 $age %ef# &7;
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

2') When Netfli/ began deli!ering s directly to customers through the mail instead of using
a bric,and,mortar system. Netfli/ was following the trend of --------0
A) indirect mareting

B)
C) disintermediation
a franchise system
) e/clusi!e distribution
") selecti!e distribution
Answer# B
iff# 1 $age %ef# &7'
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

22) Chewing gum is stoced in many outlets in the same maret or community@ in fact. it is
 placed in as many outlets as possible0 This is an e/ample of -------- distribution0
A) e/clusi!e
B) selecti!e
C) multichannel
) intensi!e
") disintermediated
Answer# 
iff# + $age %ef# &81
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,&

+&;
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2:) Which products) will most liely be intensi!ely distributed?

A) Olympus digital cameras
B) B9W cars
C) Euess blue *eans
) Coca Cola

") Nie running

Answer#  shoes
iff# 1 $age %ef# &81
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,&

:4) Which product will most liely be e/clusi!ely distributed?

A) B9W cars
B) De!i<s blue *eans
C) Baooa bubble gum
) $rairie >arms yogurt
") Coca,Cola
Answer# A
iff# 1 $age %ef# &81
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,&

:1) Tiffany J Co *ewelry can only be found in a limited number of intermediaries0 This is an
e/ample of -------- distribution0
A) e/clusi!e
B) intensi!e
C) uality
) high,end
") independent
Answer# A
iff# + $age %ef# &81
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,&

+&'
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:+) Why is it important for manufacturers to be sensiti!e to the needs of their dealers?
A) ealers ha!e few legal rights0
B) $oorly performing dealers will be replaced0
C) ealers fail to pro!ide !alue to the entire channel system0
) ealer support is essential to creating !alue for the customer0

") 9anufacturers
Answer#  cannot brea commitments to channel0
iff# + $age %ef# &8&
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,7

:&) Caterpillar. the famous hea!y euipment manufacturer. has a reputation for woring in
harmony with its worldwide distribution networ of independent dealers0 Caterpillar has shared
its successes with its dealers and protected its dealers during difficult economic times0 This is an
e/ample of --------0
A) intensi!e distribution
B) integrated logistics management
C) disintermediation
) third,party logistics
") partner relationship management
Answer# "
iff# + $age %ef# &8&
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,7

:7) 9a/ (amuelson is a high,end fashion designer who marets his clothing lines through a
limited number of highly reputable retailers0 9a/ uses --------0
A) e/clusi!e distribution
B) e/clusi!e dealing
C) e/clusi!e territorial agreements
) full,line forcing
") tying agreements
Answer# A
iff# & $age %ef# &8;
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,7

+&2
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:8) =ewels for the %ich and >amous sells !ery e/clusi!e *ewelry with a minimum price of
K+8.444 to customers around the world0 (peed of deli!ery to distant marets is a must0
9anagement should consider using -------- as its main carrier0
A) rail
B) air 

C)
) truc 
the 5nternet
") water 
Answer# B
iff# + $age %ef# &;4
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,8

:;) Eray!ille %oc and Era!el. located in a seaport town. sells roc. gra!el. and sand to local
marets0 5t has *ust been awarded a contract with a company 844 miles down the coast0
9anagement should consider switching from truc to -------- transport0
A) water 
B) rail
C) pipeline
) air 
") none of the abo!e
Answer# A
iff# + $age %ef# &;4
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,8

:') When 6ome epot allows ey suppliers to use its stores as a testing ground for new
merchandising programs. it is implementing a --------0
A) shared ser!ices
B) partnership management
C) shared pro*ects
) third,party pro*ect
") cross,functional. cross,company team
Answer# C
iff# + $age %ef# &;+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,8

+&:
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:2) $( (upply Chain (olutions. which handles all of its clients< Hgrunt worH associated with
logistics. is an e/ample of --------0
A) integrated logistics management
B) a distribution center 
C) selecti!e distribution

)
") aa cross,functional.
third,party logistics pro!ider 
cross,company team
Answer# 
iff# + $age %ef# &;+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,8

Refer to the scenario below to answer the following questions.

9iller 9eat Company contracts with se!eral 9idwestern farmers to raise beef and por
for its meat processing center0 To guarantee freshness. 9iller 9eat Company relies on a !ast
distribution networ0 >or deli!ery to local grocers in 5ndiana. 9iller 9eat uses its own fleet of
refrigerated trucs@ deli!ery to these 5ndiana grocers constitutes ;8 percent of 9iller 9eat<s
 business0 >or deli!eries in 5llinois. Wisconsin. and points directly west of the 9ississippi %i!er.
9iller 9eat Company contracts with a refrigerated fleet that specialies in e/pediting smaller
shipments0 >or faster deli!ery during pea times. 9iller 9eat Company often uses its own trucs
to deli!er to the e/pedited fleet<s consolidation point from its distribution warehouse in 5ndiana0
uring the holiday season. howe!er. se!eral specialty distributors contract with 9iller 9eat
Company to pacage specialty meats in gift bo/es. then ship them directly to the recipients0 >or
these specialty shipments within 5ndiana. 5llinois. and Wisconsin. 9iller uses its normal deli!ery
mode0 >or all other specialty shipments. 9iller ships from its distribution warehouse !ia air. then
contracts with e/pedited carriers in !arious cities to deli!er to the recipients0

::) Which of the following is one of 9iller 9eat Company<s upstream partners?
A) local grocers in 5ndiana who sell the company<s products
B) 9idwestern farmers who raise beef and por for the meat processing center 
C) the refrigerated fleet that e/pedites small shipments
) air carriers that tae 9iller<s specialty shipments
") recipients of 9iller<s gift bo/es
Answer# B
iff# 1 $age %ef# &&'
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,1

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144) 5n using air transportation and then e/pedited truc carriers to deli!er specialty items to
customers outside of a designated deli!ery range. 9iller 9eats is using --------0
A) all of its supply chain
B) all of its !alue deli!ery networ 
C) indirect mareting channels

)
") aintermodal transportation
!ertical mareting system
Answer# 
iff# + $age %ef# &;4
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,8

141) $roducing a product or ser!ice and maing it a!ailable to buyers reuires building
relationships not *ust with customers. but also with ey suppliers and resellers in the company<s
supply chain0

Answer#
iff# 1 T%" $age %ef# &&'
(ill# Concept
Ob*ecti!e# 1+,1

14+) The term supply chain may be too limited because it taes a mae,and,sell !iew of the
 business0
Answer# T%"
iff# + $age %ef# &&2
(ill# Concept
Ob*ecti!e# 1+,1

14&) 5n creating customer !alue. it is more important for a company to build relationships with
downstream channel partners than with upstream supplier partners0
Answer# >AD("
iff# + $age %ef# &&2
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,1

147) With the success of the 5nternet. few producers sell through intermediaries today0
Answer# >AD("
iff# 1 $age %ef# &&:
AAC(B# se of 5T
(ill# Concept
Ob*ecti!e# 1+,1

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148) 5maginati!e distribution systems can be used to gain a competiti!e ad!antage0

Answer# T%"
iff# 1 $age %ef# &&:
(ill# Concept
Ob*ecti!e# 1+,1

14;) A ma*or role played by intermediaries is to buy large uantities of products from many
 producers and brea them down into the smaller uantities and broader assortments wanted by
consumers0
Answer# T%"
iff# + $age %ef# &74
(ill# Concept
Ob*ecti!e# 1+,1

14') 9embers of the mareting channel may help a company complete transactions by
 performing ey functions such as promotion and negotiation0

Answer#
iff# + T%" $age %ef# &74
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,1

142) 5t is safe to say that distribution channels are fairly simple beha!ioral systems in which
 people and companies interact to accomplish indi!idual company and channel goals0
Answer# >AD("
iff# + $age %ef# &7+
(ill# Concept
Ob*ecti!e# 1+,+

14:) =udy (mith is the manager of the local 9conald<s franchise in Carter!ille0 %ecently the
home office did not let her participate in co,op ad!ertising lie the other 9conald<s in her
district0 Now she is irritated and demands fairness0 This is an e/ample of horiontal conflict0
Answer# >AD("
iff# & $age %ef# &7+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

114) 5n a con!entional distribution channel. no channel member has much control o!er the other
members. and no formal means e/ists for assigning roles and resol!ing channel conflict0
Answer# T%"
iff# + $age %ef# &7&
(ill# Concept
Ob*ecti!e# 1+,&

+7+
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111) When (herwin Williams $aint Company has single ownership of integrated. successi!e
stages of production and distribution. it has created a corporate 9(0
Answer# >AD("
iff# & $age %ef# &77
AAC(B# %eflecti!e Thining

(ill# Application
Ob*ecti!e# 1+,&

11+) When the NewWay ry Cleaners and The "asy Daundromat in your hometown *oin forces
to follow a new mareting opportunity. they are forming a horiontal mareting system0
Answer# T%"
iff# + $age %ef# &78
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,&

11&) Always >resh

and restaurants $roduce Company
at wholesale haswee
prices0 Dast a route
the selling
ownerstoopened
more than
up a 144 groceries.
wal,in schools.
discounted
consumer produce outlet0 Always is now using a multichannel distribution system0
Answer# T%"
iff# + $age %ef# &7;
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,&

117) isintermediation as a trend is on the rise in 0(0 business0

Answer# T%"
iff# 1 $age %ef# &7'
(ill# Concept
Ob*ecti!e# 1+,&

118) isintermediation has occurred when an online mareter taes business away from
traditional bric,and,mortar retailers0
Answer# T%"
iff# + $age %ef# &7'
(ill# Concept
Ob*ecti!e# 1+,&

11;) The faster the deli!ery. the greater the assortment pro!ided. and the more add,on ser!ices
supplied. the more the channel<s ser!ice le!el is restricted0
Answer# >AD("
iff# + $age %ef# &7:
(ill# Concept
Ob*ecti!e# 1+,&

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11') 5ntensi!e distribution sees many outlets in a maret. while selecti!e distribution sees only
one outlet in a gi!en maret area0
Answer# >AD("
iff# + $age %ef# &81
(ill# Concept

Ob*ecti!e# 1+,&
112) The producer and intermediaries need to agree on the terms and responsibilities of each
member. including price policies. conditions of sale. territorial rights. and specific ser!ices to be
 performed by each party0
Answer# T%"
iff# + $age %ef# &81
(ill# Concept
Ob*ecti!e# 1+,&

11:) Eenerally speaing. a company<s mareting channel ob*ecti!es are influenced by the le!el

of
its customer ser!ice
competitors. and sought. the nature of the company. its products. its mareting intermediaries.
the en!ironment0
Answer# T%"
iff# + $age %ef# &84
(ill# Concept
Ob*ecti!e# 1+,&

1+4) istribution systems are relati!ely consistent from county to country. maing it easy for
international mareters to design channels0
Answer# >AD("
iff# + $age %ef# &8+
AAC(B# 9ulticultural and i!ersity
(ill# Concept
Ob*ecti!e# 1+,&

1+1) nder the strategy of e/clusi!e distribution. a seller allows only certain retail outlets to
carry its products0
Answer# T%"
iff# + $age %ef# &8;
(ill# Concept
Ob*ecti!e# 1+,7

1++) (ome ma*or corporations such as $rocter J Eamble and Eeneral 9otors ha!e de!eloped
logistics systems that both ma/imie customer ser!ice and minimie distribution costs0
Answer# >AD("
iff# & $age %ef# &8'
(ill# Concept
Ob*ecti!e# 1+,8

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1+&) The ey to managing in!entory is to balance the costs and benefits of holding larger
in!entories with the costs and benefits of holding less0
Answer# T%"
iff# & $age %ef# &8:
(ill# Concept

Ob*ecti!e# 1+,8
1+7) When shipping large amounts of bul products such as forest products. coal. sand. or roc
o!er long distances. a company should choose large trucs because of their low cost per ton
shipped0
Answer# >AD("
iff# 1 $age %ef# &;4
AAC(B# Analytic (ills
(ill# Concept
Ob*ecti!e# 1+,8

1+8) 5ntegrated
distribution logistics
costs throughmanagement aimsinside
teamwor. both to pro!ide better customer
the company ser!ice
and among andmareting
all the trim
channel organiations0
Answer# T%"
iff# + $age %ef# &;1
AAC(B# Communication
(ill# Concept
Ob*ecti!e# 1+,8

1+;) "/plain why H!alue deli!ery networH is a more rele!ant e/pression to use than the terms
supply chain and demand chain0
Answer# (upply chain taes a mae,and,sell !iew of the business. using materials and other
inputs as the starting point for maret planning instead of the needs of target customers0 emand
chain taes a sense,and,respond !iew. starting with the needs of target customers and planning a
chain of resources and acti!ities with the goal of creating customer !alue0 6owe!er. a demand
chain is a step,by,step. linear !iew of purchase,production,consumption acti!ities0 This does not
allow for the fle/ibility made possible by the 5nternet and other technologies0 alue deli!ery
networ is more appropriate because it is made up of the company. suppliers. distributors. and
ultimately customers who partner with each other to impro!e the performance of the entire
system0
iff# 1 $age %ef# &&2
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,1

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1+') 6ow do channel members add !alue to a mareting system?

Answer# 5ntermediaries reduce the amount of wor that must be done by both producers and
consumers0 They transform the assortment of products made by producers into the assortment
wanted by consumers0 They buy large uantities from many producers and brea them down into
the smaller uantities and broader assortments wanted by consumers0 5ntermediaries help to

match supply
 possession andthat
gaps demand0 Channel
separate goods members addfrom
and ser!ices !aluethose
by bridging the ma*or
who would time. place. and
use them0
iff# + $age %ef# &&:
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,1

1+2) What are the eight ey functions that members of the mareting channel perform?
Answer# (ome help to complete transactions by gathering and distributing information.
de!eloping and spreading promotions. contacting prospecti!e buyers. matching and shaping the
offer to the buyer<s needs. and negotiating price and other terms0 Others help to fulfill the

completed
iff# + transactions through
$age %ef# &74 physical distribution. financing. and ris taing0
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,1

1+:) Compare and contrast a con!entional distribution channel with a !ertical mareting system
9()0
Answer# A con!entional distribution channel consists of one or more independent producers.
wholesalers. and retailers0 "ach is a separate business seeing to ma/imie its own profits. e!en
at the e/pense of the system as a whole0 No channel member has much control o!er the other
members. and no formal means e/ists for assigning roles and resol!ing channel conflict0 On the
other hand. a !ertical mareting system is a unified system made up of producers. wholesalers.
and retailers0 While members of a con!entional distribution channel see to ma/imie their own
 profits. members of a !ertical mareting system all cooperate because either one member owns
the others. one has contracts with the others. or one wields a more power than the others0
iff# & $age %ef# &77
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,+

1&4) Why are multichannel distribution systems gaining popularity today?

Answer# 9ultichannel distribution systems e/ist when a single firm sets up two or more
mareting channels to reach one or more customer segments0 (uch a system offers ad!antages to
firms facing large and comple/ marets0 5t allows the firms to e/pand sales and maret co!erage0
5t allows firms to tailor their products and ser!ices to the specific needs of di!erse customer
segments0 Darger bottom,line profits may occur0
iff# + $age %ef# &7;
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,+

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1&1) 6ow ha!e changes in technology and the growth of online mareting affected the design of
mareting channels?
Answer# Changes in technology and the growth of online mareting ha!e increased
disintermediation. which is the cutting out of mareting channel intermediaries by product or
ser!ice producers. or the displacement of traditional intermediaries with radically new types0 5n

many industries.
airlines traditional
now sell directly intermediaries
to final are dropping
buyers. cutting retailersby thesales
and wayside0
agents>or e/ample.
from many
their mareting
channels0 Online mareters tae business from traditional bric,and,mortar retailers0
iff# + $age %ef# &7'
AAC(B# se of 5T
(ill# Application
Ob*ecti!e# 1+,+

1&+) istinguish between the three distribution strategies0

Answer# $roducers of con!enience products and common raw materials typically see intensi!e
distribution as a strategy to stoc their products in as many outlets as possible0 The goods are
a!ailable where and when consumers want them. such as chewing gum0 (electi!e distribution is
used when selling to more than one but fewer than all of the intermediaries who are willing to
carry a company<s products in a gi!en maret0 "/amples are name,brand blue *eans and
computers0 "/clusi!e distribution is used when the producer wants to stoc its products with
only one or a few dealers in an area0 "/amples are e/pensi!e cars and prestige clothing0
iff# 1 $age %ef# &81
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,&

1&&) "/plain how companies select. moti!ate. and e!aluate channel members0
Answer# When selecting intermediaries. the company should e!aluate each channel member<s
ualifications and select those who best fit its channel ob*ecti!es0 The company should use
economic criteria. control issues. and adapti!e criteria to analye each possible channel member0
Once selected. channel members must be continuously moti!ated to do their best0 The company
must sell not only through the intermediaries but also to and with them0 5t should wor to forge
long,term partnerships with channel partners to create a mareting system that meets the needs
of both the manufacturer and the partners0 The company must also regularly chec channel
member performance against established performance standards. rewarding intermediaries who
are performing well and assisting or replacing weaer ones0
iff# + $age %ef# &8+
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,7

+7'
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1&7) iscuss how public policy affects distribution decisions0

Answer# >or the most part. companies are legally free to de!elop whate!er channel arrangement
suits them. as long as they do not substantially lessen competition or tend to create a monopoly.
and as long as both parties enter into the agreement !oluntarily0 "/clusi!e territorial agreements
in which a producer attempts to eep a dealer from selling outside of a designated territory ha!e

 become a ma*or
legitimate cause legal issue0 $roducers
to terminate are free
a relationship withtoaselect
dealer0their dealers. but they must ha!e
iff# & $age %ef# &88,&8;
AAC(B# "thical %easoning
(ill# Application
Ob*ecti!e# 1+,7

1&8) Why are more and more companies turning to third,party logistics pro!iders &$Ds)?
Answer# A third,party logistics pro!ider is an independent company that performs any or all of
the functions reuired to get a producer<s product to maret. helping clients to tighten up
sluggish. o!erstuffed supply chains. slash in!entories. and get products to customers more
uicly and reliably0 Companies use third,party logistics pro!iders because getting the product to
maret is the main focus of &$Ds. so they can often do it more efficiently and at a lower cost0
(econd. outsourcing logistics frees a company to focus more intensely on its core business0
>inally. integrated logistics companies understand increasingly comple/ logistics en!ironments0
>or e/ample. third,party logistics partners can be especially helpful to companies attempting to
e/pand their global maret co!erage0
iff# & $age %ef# &;+
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,8

1&;) What is the role of mareting intermediaries?

Answer# The role of mareting intermediaries is to transform the assortments of products made
 by producers into the assortments wanted by consumers0
iff# 1 $age %ef# &74
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,1

1&') Ei!e an e/ample of horiontal conflict0

Answer# This type of conflict occurs among firms at the same le!el of the channel@ an e/ample
would be two Che!rolet dealers in the (t0 Douis area that complain that each is being undercut by
the other0
iff# 1 $age %ef# &7+
AAC(B# %eflecti!e Thining
(ill# Application
Ob*ecti!e# 1+,+

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1&2) Ei!e an e/ample of !ertical conflict0

Answer# This type of conflict occurs between different le!els of the same channel@ an e/ample
would be conflict created by a manufacturer toward its dealers when deciding to open an online
operation0
iff# 1 $age %ef# &7+

AAC(B# %eflecti!e Thining

(ill# Application
Ob*ecti!e# 1+,+

1&:) "/plain channel power in a con!entional distribution channel0

Answer# No channel member has much control o!er the other members. and no formal means
e/ists for assigning roles and resol!ing channel conflict0
iff# + $age %ef# &77
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,+

174) "/plain channel power in a !ertical mareting system0

Answer# One channel member owns the others. has contracts with them. or wields so much
 power that they must all cooperate0
iff# + $age %ef# &77
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,+

171) 6ow can a firm benefit from in!ol!ement in a contractual 9(?

Answer# A contractual 9( consists of independent firms at different le!els of production and
distribution that *oin together through contracts to obtain more economies or sales impact than
each could achie!e alone0
iff# & $age %ef# &78
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,+

17+) 6ow can a firm benefit from participating in a horiontal mareting system?
Answer# Two or more companies at one le!el *oin together to follow a new mareting
opportunity@ by woring together. companies can combine their financial. production. or
mareting resources to accomplish more than any one company could alone0
iff# & $age %ef# &78
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,+

+7:
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17&) Ei!e two e/amples of multichannel distribution systems0

Answer# (tudents< answers will !ary0 "/amples will include =0 C0 $enney<s catalog distribution
option and the retail store locations as well as A!on<s door,to,door distribution and o!er,the,
counter distribution options0
iff# + $age %ef# &7;

AAC(B# %eflecti!e Thining

(ill# Application
Ob*ecti!e# 1+,+

177) What types of products are intensi!ely distributed?

Answer# These products must be a!ailable where and when consumers want them@ e/amples
include chewing gum. soft drins. toothpaste. and candy0
iff# 1 $age %ef# &81
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,&

178) What types of products are e/clusi!ely distributed?

Answer# "/clusi!e distribution is often used for e/pensi!e automobiles and prestige clothing0
These products are geographically dispersed0
iff# 1 $age %ef# &81
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,&

17;) What types of products are selecti!ely distributed?

Answer# With this type of distribution. more than one. but fewer than all. of the intermediaries
who are willing to carry a company<s products are used0 $roducts include appliances and some
name,brand clothing0
iff# 1 $age %ef# &81
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,&

17') What are two considerations when selecting intermediaries?

Answer# A company may want to e!aluate each channel member<s years in business. other lines
carried. growth and profit records. cooperati!eness. and reputation0
iff# & $age %ef# &8&
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,7

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172) When would an e/clusi!e dealing contract be legally problematic?

Answer# An e/clusi!e dealing contract may be illegal if one party has not !oluntarily agreed to
the contract. or if the arrangement substantially lessens competition or tends to create a
monopoly0
iff# & $age %ef# &8;

AAC(B# "thical %easoning

(ill# Application
Ob*ecti!e# 1+,7

17:) 6ow can a company benefit through a *ust,in,time logistics system?

Answer# With such systems. producers and retailers carry only small in!entories of parts or
merchandise. often only enough for a few days of operations0 This creates substantial sa!ings in
in!entory,carrying and handling costs0
iff# + $age %ef# &8:
AAC(B# Analytic (ills
(ill# Application

Ob*ecti!e# 1+,8
184) "/plain why a firm<s suppliers tap into the firm<s in!entory le!els with a !endor,managed
in!entory system 95)0
Answer# (ome suppliers might actually be ased to generate orders and arrange deli!eries for
their customers. based on the customers< in!entory le!els@ in these cases. the suppliers must
now their customers< in!entory le!els0
iff# & $age %ef# &;1
AAC(B# Analytic (ills
(ill# Application
Ob*ecti!e# 1+,8

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