MKTG 351 Test 3 Cousley (Chapter 14)

What is a primary difference between an industrial distributor and a manufacturers' agent?

A manufacturers' agent does not acquire title nor usually take possession of the products whereas an industrial distributor does

When a single channel member manages an integrated marketing channel to achieve low- cost, efficient distribution for satisfying target markets, ______ exists

A vertical marketing system

Industrial distributors are increasingly carrying more _____ products.

Business

When one company in a marketing channel has the ability to influence another member's goal achievement, the company has

Channel Power

A single leader who controls and organizes a marketing channel is called a

Channel captain

If a wholesaler continually emphasizes and promotes one company's products over a competing company's products, _____ is likely to result

Channel conflict

Overall channel goals and individual channel member goals cannot be achieved together without

Cooperation

All members of the supply chain should determine their position in the chain, identify their partners and their roles, and establish partnerships whose focus is

Customer relationships

The driving force behind marketing channel decisions should be

Customer satisfaction

Many companies use more than one marketing channel to distribute their products to the same target market, a tactic called

Dual distribution

The greatest advantage of horizontal channel integration is

Efficiencies in advertising, marketing research, and purchasing are increased

When only one outlet in a relatively large geographic area is used to distribute a product that is consumed over a long period of time, a(n) ___________ channel arrangement is developed

Exclusive

Expensive, high-quality products that are purchased infrequently often reach consumers through

Exclusive distribution

The three major levels of intensity at which a company can choose to distribute its products are _____ distribution.

Exclusive, selective, intensive

Which of the following organizations consolidates shipments from several firms into more efficient lot sizes?

Freight forwarder

An independent business that takes title to products and carries inventories is a(n)

Industrial distributor

Producers of convenience products such as soft drinks, toothpaste, and breath mints are most likely to use _____ distribution

Intensive

Sales are most likely to have a direct relationship to product availability for products that use _____ distribution

Intensive

___________ is the combining and coordinating of two or more modes of transportation to take advantage of benefits offered by each of the different types of carriers

Intermodal transportation

Because of the significant investment many companies have in the products they sell to customers, they must develop and maintain adequate varieties of products to meet their customers' needs. This is called

Inventory management

The result of an inventory stockout is usually an increase in

Lost sales

A group of organizations and individuals that directs the flow of products from producers to the ultimate consumers is called a

Marketing Channel

What links producers to consumers through the purchase and reselling of products or contractual agreements?

Marketing intermediaries

What are the three primary tasks of order processing?

Order handling, order entry, order delivery

The contracting of physical distribution tasks to third parties who do not have managerial authority within the marketing channel is known as

Outsourcing

Order processing, inventory management, materials handling, warehousing, and transportation are the activities that define

Physical distribution

Marketing channels create three types of utility for consumers including

Place, time and possession

Which of the following is the most commonly used channel for distributing business products?

Producer, organizational buyers

Large retailers such as J.C. Penney's and Target are most likely to participate in which of the following channels?

Producer, retailers, consumers

Using only some of the available outlets to distribute a product is called

Selective distribution

Long-term partnerships among channel members working together to reduce inefficiencies, costs, and redundancies in the entire marketing channel is called

Supply Chain Management

Which of the following describes a disadvantage of using industrial distributors?

They are unlikely to handle bulky items or items that are slow sellers

Which of the following is an advantage of using an industrial distributor?

They help reduce a producer's financial burdens by extending credit to customers

Channel decisions are important to marketers mostly because

They involve long term commitments and affect customer accessibility

Having products available when the customer wants them is called

Time utility

What is the most expensive physical distribution function?

Transportation

In a simple economy of five producers and five consumers, there would be ___________ transactions possible without an intermediary and _________ transactions possible with one intermediary

Twenty-five, ten

Bennetton, a leading manufacturer of knitwear in Italy, expanded its operations to include retail outlets in the United States and South America. This type of integration is called

Vertical

What function of physical distribution enables companies to compensate for dissimilar production and consumption rates and stabilize prices and availability of seasonal items?

Warehousing

Which of the following physical distribution functions involves design and operation of facilities for storing goods?

Warehousing

A channel that includes both a manufacturers' agent and an industrial distributor is appropriate under which of the following circumstances?

When the marketer wishes to enter a new geographic market but does not wish to expand the existing sales force

An agreement in which the products of one organization are distributed through the marketing channel of another organization is called

a strategic channel alliance

In an administered vertical marketing system (VMS), interorganizational relationships are

achieved by informal coordination

A producer is not likely to receive _____ from an industrial distributor

aggressive promotion of its brand

The supply chain includes

all entities that facilitate product distribution

A public warehouse is a

business that leases storage space and related facilities for distribution to other firms

Marketing channel members are likely to experience misunderstandings, frustration, and poorly coordinated strategies as a result of

channel conflict caused by inefficient communication between channel members

The Limited, which produces and retails clothing products in a coordinated channel, is an example of a(n)

corporate vertical marketing system

Where do supply chains start?

customers

An important goal of physical distribution is reducing the time it takes to complete

cycle time

The main objective of physical distribution should be to

decrease costs while increasing service

Many producers selling on the Internet are using

direct marketing channels

A channel of distribution is defined as a group of individuals and organizations that

directs the flow of products from producers to customers

A commonly used computerized means of integrating order processing with production, inventory, accounting, and transportation is

electronic data interchange

An arrangement where a producer forbids an intermediary to carry products made by competing manufacturers is called

exclusive dealing

Organizational buyers are especially partial to direct marketing channels when

expensive and/or complex equipment is involved

Justin Abercrombie attends a seminar on just-in-time inventory management. Excited about the idea, he returns to his office at Atlanta Auto Supply to start designing such an inventory system. Which of the following steps must Justin take as he institutes this change? a)Increase safety stock b)Raise the reorder point c)Reduce customer service standard d)Increase order frequency e)Reduce estimates of inventory turnover rate

increase order frequency

Vertical channel integration

is made possible by purchasing the operations of a link in the channel

A manufacturer has decided to improve its inventory management by maintaining low inventory levels and waiting to purchase materials until right before they are needed in production. This inventory management technique is called

just-in-time (JIT)

Eliminating a wholesaler from a marketing channel will

not eliminate the functions performed by that wholesaler

What is the primary determinant in deciding how materials will be handled?

product characteristics

Which of the following is least likely to be a factor affecting the selection of marketing channels?

product packaging

Consumers receive the benefits of place utility when

products are available in locations where consumers want to but them

Without wholesalers and other intermediaries,

products would likely be more expensive due to the use of less efficient channel members.

Using a freight forwarder usually

reduces transit time

After direct-marketing, the next slightly longer marketing channel adds a(n)

retailer

All of the following are concepts used in a just-in-time inventory management system except a)supplies arrive just as they are needed. b)safety stock is kept to reduce stockouts. c)much waste is eliminated. d)purchases are made in small quantities. e)purchases are made frequently.

safety stock is kept to reduce stockouts

In an administered VMS, informal coordination brings about a high level of interorganizational management. Nonetheless,

the channel members remain autonomous

Possession utility is best described as

the customer having access to the product to use now or store and use later

The notion of physical distribution is

the movement of products from producers to end users.

Order processing is defined as

the receipt and transmission of sales order information

The main reason a manufacturer will prohibit intermediaries from selling its products outside designated sales territories is to

tighten its control over distribution of its products

The reasons a vertically integrated channel can be more effective against competition is because of all of the following except a)the consolidation of power b) tightly controlled and bureaucratic management style c)the ability to inhibit competitors d)the sharing of responsibilities and information e) increased bargaining power

tightly controlled and bureaucratic management style

The best way to reduce overall distribution costs is to

use a total-cost approach to analyze and evaluate the entire system

According to the text, physical distribution cost tradeoffs enable firms to

utilize resources for greatest cost-effectiveness