Chapter 15 International Marketing Channels

Identify an accurate statement about piggyback arrangements.

Usually merchants buy the products and resell them at a profit.

Goods are sold and physically moved in

a distribution process.

Parent companies exert control over middlemen by monitoring

advertising and profit. prices and payment of bills. services offered. coverage of market. sales volume.

Export management companies operate under the authority of the manufacturers as

affordable autonomous marketing organizations.

Select the roles that can be played by a foreign sales corporation.

an agent working on commission a principal

In a traditional distribution structure, a limited amount of merchandise is controlled by

an importer.

Although Webb-Pomerene export associations are allowed to form business groups that export products, they are forbidden from

belonging to cartels

Trading companies in developed countries

buy raw materials from developing countries.

In foreign countries, adequate market coverage may require

changing the way products are distributed.

Companies practicing complementary marketing have

international distribution channels.

]When companies use foreign-country middlemen,

international marketers achieve more control over their distribution systems.

Logistics management involves the physical transportation of

inventory that is ready to ship to customers. merchandise that is being processed. raw materials.

The total distribution process of an international trade channel is handled through

logistics management.

People or firms that provide international selling services for manufacturers are known as

manufacturer's export agents.

A foreign sales corporation can be formed by

manufacturers and groups of businesses that export merchandise.

Envy Corp., a textile company, launches a line of women's wear that is sold in stores owned by the company. These stores are examples of

manufacturers' retail stores.

When stores are owned by manufacturers and used as channels of distribution, those stores are known as

manufacturers' retail stores.

The first people involved in the distribution channel process are the

manufacturers.

Before choosing middlemen, a company should consider

markets that will be targeted, in specific countries and across broad regions. goals such as how much sales volume the venture needs to generate. how many people and how much money will be devoted to global marketing.

Identify a factor that improves supply-chain management.

online B2B marketing

Firms must establish _____ before choosing channel middlemen.

operational policies

What did the Export Trading Company Act accomplish?

1. Companies have greater access to funding for international trade enterprises. 2. Certain antitrust laws have been scaled back, allowing companies to form large, powerful joint ventures. 3. Producers and suppliers are able to export their products more effectively.

What are the advantages of using middlemen in foreign lands?

1. They help connect companies that make goods with the people who will buy them. 2. They are better able to deal with difficulties arising from the distribution of products, funding, and foreign languages.

Employing home-country middlemen proves advantageous when companies

1. have not previously competed very much in the global market. 2. want to participate in the global market without committing much money to the effort. 3. are not making many sales globally.

Export management companies handle

1. studying the market. 2. advertising and exhibiting the products. 3. shipping of products to customers.

Throughout the world, traditional distribution channels are becoming more efficient, which has led to

1. the introduction of direct marketing and discounting. 2. the emergence of e-commerce and supermarkets. 3. the rise of mass merchandising. 4. a preference for self-service.

Why do firms undertake piggyback arrangements?

1. to enable their distribution systems to operate all year long 2. to offer more product lines

Identify the features of export management companies. (Check all that apply.) 1. They sell products under their own names. 2. They help firms to involve their own personnel in international marketing. 3. They are independent companies but answer directly to the manufacturers. 4. They handle international marketing for manufacturers that do not have large global sales revenues.

3. They are independent companies but answer directly to the manufacturers. 4. They handle international marketing for manufacturers that do not have large global sales revenues.

Identify the accurate statements about a distribution process. (Check all that apply.) A. Commercial negotiations occur among producers, middlemen, and buyers. B. Ownership or title is passed. C. Customer data are transmitted across offices. D. Middlemen conduct promotional activities for products.

A. Commercial negotiations occur among producers, middlemen, and buyers. B. Ownership or title is passed.

Identify the disadvantages of working with export management companies. A. If the product is not making much money, the company sometimes fails to promote it aggressively. B. They require firms to make large investments to get into global market. C. They expect the manufacturer to provide a large crew of employees to help promote the product globally. D. They usually cannot afford to invest enough money to achieve deep distribution of the product.

A. If the product is not making much money, the company sometimes fails to promote it aggressively. D. They usually cannot afford to invest enough money to achieve deep distribution of the product.

What are the advantages of working with export management companies? A. They are paid on commission. B. They help companies avoid assigning their own employees and managers to foreign marketing efforts. C. They provide a large group of new employees who can be assigned to any task the manufacturer desires. D. They help companies penetrate foreign markets at a relatively small cost.

A. They are paid on commission. B. They help companies avoid assigning their own employees and managers to foreign marketing efforts. D. They help companies penetrate foreign markets at a relatively small cost.

The Japanese distribution system is characterized by A. a business philosophy based on a distinctive culture. B. laws that safeguard small retailers. C. dependency on numerous small middlemen. D. retailers who dictate the way goods are distributed. E. laws protecting exporters. F. manufacturers who control the channels that distribute merchandise.

A. a business philosophy based on a distinctive culture. B. laws that safeguard small retailers. C. dependency on numerous small middlemen. F. manufacturers who control the channels that distribute merchandise.

What did the Export Trading Company Act accomplish? A. Multinational corporations have been prevented from overwhelming smaller competitors. B. Producers and suppliers are able to export their products more effectively. C. Certain antitrust laws have been scaled back, allowing companies to form large, powerful joint ventures. D. Companies have greater access to funding for international trade enterprises.

B. Producers and suppliers are able to export their products more effectively. C. Certain antitrust laws have been scaled back, allowing companies to form large, powerful joint ventures. D. Companies have greater access to funding for international trade enterprises.

Select the benefits offered by Webb-Pomerene export associations. A. increase trade barriers B. establish prices and product standards C. make intellectual property laws more flexible D. advertise to build interest in products E. form a group of businesses that can export merchandise at a lower cost F. strike bargains to achieve better trading relationships

B. establish prices and product standards D. advertise to build interest in products E. form a group of businesses that can export merchandise at a lower cost F. strike bargains to achieve better trading relationships

Identify an accurate statement about the Japanese distribution system. A. It involves few wholesalers. B. Customers seldom go shopping, and they usually buy in bulk, stocking up on items that are on sale. C. It offers almost no legal protection to small retailers. D. It depends on an unusually large number of middlemen.

D. It depends on an unusually large number of middlemen.

What legislation permitted the formation of export trading companies by producers of similar products?

Export Trading Company Act

True or false: Export management companies do not rely on sales volume for their compensation.

False

True or false: Worldwide, retailing has been generally stagnant for the past couple of decades.

False

What are the benefits of obtaining full-market coverage? (Check all that apply.)

The company can claim a substantial share of the market. The product can become so well known that most people in the market will recognize it.

How are small stores in Japan different from their counterparts in the United States?

They account for a larger percentage of total retail sales.

When a company wants to offer a wider selection of merchandise for its international marketing efforts, it sometimes adds products that work well with its original products. In these cases, the company is engaged in

complementary marketing. piggybacking.

The last people involved in the distribution channel process are the

consumers

Drew's Corp., a baby-product manufacturing company, eliminated middlemen in its product distribution process. Instead, it entrusted the task to one of its managers. In this scenario, the company increased its

control over channels.

When distribution channels are lengthened,

control over volume decreases. control over price decreases. control over promotion decreases. control over outlet variety decreases.

Which of the following middlemen are likely to be loyal to their vendors? (Check all that apply.)

distributors dealers

Home-country middlemen are also known as

domestic middlemen.

To improve the efficiency of their distribution systems, marketers around the world are experimenting with

door-to-door selling. selling via hypermarkets, shopping malls, and discount houses. direct marketing. selling via the Internet.

The World Wide Web is used to sell industrial goods, in addition to consumer services and merchandise, via

e-commerce.

The recent rapid change in retail markets around the world is apparently a result of

economic development.

True or false: Channel patterns are constant and seldom undergo changes.

false

True or false: Distributing goods via the Internet is a form of indirect selling.

false

True or false: Exporters cannot dismiss distributors who fall short of sales minimums.

false

Online B2B marketing helps

increase inventory control.

Identify the measures to manage middlemen's activities. (Check all that apply.)

quotas sending personnel from the company to visit the middlemen reports

It is particularly important for firms to maintain good rapport with their middlemen in countries where the most important cultural factor is _____.

relationships

The largest investment of funds is required when a firm

relies on its own sales force.

What do manufacturers receive from manufacturer's export agents?

selling services

When consumers stop buying a brand for a particular period of time, middlemen tend to

soon stop selling those products.

When distribution agreements are made with middlemen, firms must

specify what will be expected of the company and the middleman.

To ensure that middlemen will continue to be enthusiastic about selling its products, a company should

stay in touch via newsletters, for example. offer sufficient financial compensation. handle disputes with tact.

When a market has a traditional distribution structure, mass distribution and market penetration are not necessary, because

there is not enough product to meet customer demand.

Middlemen spend money (and therefore ultimately drive up the price of the merchandise) when

they advertise products locally. they sell products as the representatives of the manufacturer. they move and store merchandise.

The combined costs of all facets of a physical distribution system are called the

total cost.

Goods are collected, shipped, and sold from many countries by

trading companies.

Identify the facets of a physical distribution system. (Check all that apply.)

transportation inventories plants and warehousing packing of goods

Identify a factor that reduces the amount of money a firm must invest in channel management.

use of distributors

When selecting a distribution channel, a company should consider

whether the sale of the product will involve a complex procedure. the product's size. how much money the product is worth. whether the product is apt to spoil easily. whether the product will require any sales service.