Marketing Test 2- CH 14
A firm has $2,000,000 in net annual sales, its beginning inventory (for the year) was $400,000 (at retail), and its ending inventory was $600,000 (at retail). The firm's stock turnover rate for the year is
4.0 times
A firm has order-processing costs of $8, an annual demand of 4,000 units, holding costs equal to 20 percent of the average inventory on hand, and wholesale unit costs of $2. What is its economic order quantity?
400 units
A firm's order lead time is 7 days, its usage rate is 5 units per day, and its safety stock is 10 units. Its reorder point is
45 units
Which of these illustrates channel cooperation?
A manufacturer granting a wholesaler credit for all sales in its territory, whether or not initiated by the wholesaler
An important characteristic of a direct channel of distribution is
a high level of channel control
central component to relationship marketing is
a long-term relationship among distribution intermediaries.
just in time inventory system
a purchasing firm reduces the amount of inventory it keeps on hand by ordering more often and in lower quantity
High-value, perishable, and emergency goods dominate which transportation form?
airways
A slotting allowance, in which retailers require that a manufacturer pay for the use of shelf space for new products, illustrates
channel conflict
Which of these is NOT a channel member?
competitors
channel of distribution
comprises all the organizations or people involved in the distribution process
total delivered product
comprises the bundle of tangible and intangible product attributes actually provided to consumers through a value chain and its related value delivery chain
Which concept is central to a pulling strategy?
derived demand
No independent intermediaries are used in which type of distribution channel?
direct
Vertical integration (such as a manufacturer's undertaking retail responsibilities through ownership) is an example of a(n)
direct channel of distribution
The tire manufacturer is interested in differentiated marketing in which it appeals to both price-conscious shoppers through mass merchandisers and to service-oriented shoppers through gasoline stations and tire specialty stores. The firm should utilize which type of distribution?
dual channels
The order volume corresponding to the lowest sum of order-processing and inventory-holding costs is known as the
economic order quantity
value delivery chain
encompasses all of the parties who engage in value chain activities
selective distribution
firm employs a moderate number of resellerscombine some channel control with good sales volume
In a just-in-time (JIT) inventory system,
firms order frequently and in lower quantities.
4 stages of the distrubution process
goals, value chain and value delivery chain, total delivered product, and level of satisfaction
containerization
goods are placed in sturdy containers that can be loaded easily
A major advantage of vertical integration (such as a manufacturer's undertaking retail responsibilities through ownership) is that it
increases control over other channel members.
Channel length refers to the
levels of independent members along a distribution channel.
distribution intermediaries
links between manufacturers/service providers and consumers
The broad range of activities concerned with efficiently delivering raw materials, parts, semifinished items, and finished products to designated places, at designated times, and in proper condition constitute
logistics.
Functions performed in a channel of distribution
marketing research, distribution, pricing, product planning, customer services, promotion, and buying
channel members
may include manufacturers, service providers, wholesalers, retailers, marketing specialists, and/or consumers
direct channel of distribution
movement of goods and services from producer to consumers without the use of independent intermediaries
Channel width refers to the
number of independent channel members at any stage of distribution.
channel width
number of independent members
equation
number of units sold/costs of goods sold divided by average inventory on hand
warehousing
physical facilities used to store , identify, sort goods in expectation of their sale and transfer within a distribution channel
For a manufacturer, the training of a wholesaler's sales personnel, providing of promotional materials, and offering a special sales contest for the wholesaler's sales personnel are important elements in which type of distribution strategy?
pushing
5 basic transportation forms
railroads, motor carriers, waterways, pipelines, and airways
Which concept in distribution is based upon the concept of long-term relationships, and partnerships between customers and their suppliers?
relationship marketing
value chain
represents the series of business activities that are performed to design, produce, market, deliver, and service a product for customers.
exclusive distribution
severly limits the number of resellers utilized in a geographic area seeking a prestige image and more control
The number of times during a stated period (usually one year) that the average inventory on hand is sold is known as
shock turnover
Vertical integration (such as a manufacturer's undertaking retail responsibilities through ownership) enables a firm to
shorten its distribution channel.
freight forwarding
specialized firms collect small shipments from several companies
computing Economic order quantity
square root of 2*demand*cost to place an order/ annual holding costs*unit cost of an item
electronic data interchange
suppliers and their organizational consumers exchange data via computer linkups
level of satisfaction
the contentment of each party is determined and related to its goals
With an administered channel arrangement
the dominant firm in the distribution process plans the marketing program and itemizes and coordinates each member's duties.
channel length
the levels of independent members
stock turnover
the number of times during a stated period that average inventory on hand is sold
The transportation method with the lowest shipping cost may not be selected due to its high inventory-carrying costs. This illustrates
the total cost approach
indirect channel of distribution
uses independent intermediaries
intensive distribution
uses large number of resellers, wide market coverage and high total sales