Chapter 12: Marketing Channels: Delivering Customer Values

Which of the following describes a​ just-in-time logistics​ system? A. ​Just-in-time logistics systems allow producers and retailers to carry small inventories to last for only a few days of operations. B. ​Just-in-time logistics systems allow producers and retailers to carry large amounts of inventory. C. ​Just-in-time logistic systems eliminate the need for forecasting. D. ​Just-in-time logistics systems ensure that new stock arrives at least one week before it is needed. E. ​Just-in-time logistics systems greatly increase​ inventory-carrying and​ inventory-handling costs.

A. ​Just-in-time logistics systems allow producers and retailers to carry small inventories to last for only a few days of operations.

The franchise organization is the most common type of​ __________ VMS​ (vertical marketing​ system). A. contractual B. corporate C. conventional D. horizontal E. administered

A. contractual

Companies today see channel members as​ first-line customers and practice strong​ ________. A. partner relationship management B. discount pricing strategies C. consumer advertising strategies D. trade promotion strategies E. B2B selling

A. partner relationship management

​________ involves​ reusing, recycling,​ refurbishing, or disposing of​ broken, unwanted, or excess products returned by consumers or resellers. A. Reverse logistics B. Outbound logistics C. Warehousing D. Inventory management E. Inbound logistics

A. reverse logistics

Using​ ________, the customer shares​ real-time data on sales and current inventory levels with the supplier. The supplier then takes full responsibility for managing inventories and deliveries. A. ​vendor-managed inventory B. ​just-in-time logistics systems C. piggybacking D. RFID E. reverse logistics

A. vendor-managed inventory

Large retailers like Walmart have enormous channel control due to their size and power. Which type of channel arrangement does this​ represent? A. A contractual VMS B. An administered VMS C. A conventional distribution channel D. A corporate VMS E. A franchise organization

B. an administered VMS

Distribution channels are more than simple collections of firms tied together by various flows. Which of the following statements is NOT a characteristic of distribution​ channels? A. They are complex behavioral systems in which people and companies interact to accomplish​ individual, company, and channel goals. B. Channel systems stand​ still, restricting formation of new intermediary systems. C. Some channel systems consist of only informal interactions among loosely organized firms. D. A marketing channel consists of firms that have partnered for their common good. E. Some channels consist of formal interactions guided by strong organizational structures.

B. channel systems stand still, restricting formation of new intermediary systems

Channel members should be selected on the basis of all of the following attributes except​ __________. A. cooperativeness B. competitiveness C. reputation D. years in business E. growth and profit record

B. competitiveness

Channel members should be selected on the basis of all of the following attributes except​ __________. A. years in business B. competitiveness C. cooperativeness D. growth and profit record E. reputation

B. competitiveness

​Historically, __________ have lacked leadership and​ power, often resulting in damaging conflict and poor performance. A. vertical marketing systems B. conventional distribution channels C. administered vertical marketing systems D. corporate vertical marketing systems E. contractual vertical marketing systems

B. conventional distribution channels

The concept of​ __________ recognizes that providing better customer service and trimming distribution costs require teamwork. A. supply chain management B. integrated logistics management C. physical distribution management D. warehouse management E. inventory management

B. integrated logistics management

From the​ producer's point of​ view, a greater number of levels of marketing channel means​ __________. A. less control and less channel complexity B. less control and greater channel complexity C. no control and greater channel complexity D. no control and no channel complexity E. more control and greater channel complexity

B. less control and greater channel complexity

In making products and services available to​ consumers, channel members add value. Key functions performed by the marketing channels include all of the following except​ __________. A. promotion B. pricing C. matching D. negotiation E. distribution of information

B. pricing

Which channel partners in a​ company's supply chain are upstream from a manufacturer or​ producer? A. Wholesalers B. Suppliers C. Customers D. Retailers E. Business distributors

B. suppliers

When the company has defined its channel​ objectives, it should next identify its major channel alternatives in terms of the types of​ intermediaries, the number of​ intermediaries, and​ ________. A. whether to use intensive or exclusive distribution B. the responsibilities of channel members C. the profitability of the channel D. economic criteria E. consumer needs

B. the responsibilities of channel members

Distribution channels are more than simple collections of firms tied together by various flows. Which of the following statements is NOT a characteristic of distribution​ channels? A. Some channels consist of formal interactions guided by strong organizational structures. B. They are complex behavioral systems in which people and companies interact to accomplish​ individual, company, and channel goals. C. Channel systems stand​ still, restricting formation of new intermediary systems. D. Some channel systems consist of only informal interactions among loosely organized firms. E. A marketing channel consists of firms that have partnered for their common good.

C. Channel systems stand​ still, restricting formation of new intermediary systems.

Which of the following is a reason that producers use marketing channels and channel​ intermediaries? A. Using marketing channels allows producers to retain control over how and to whom they sell their products. B. The reduced costs of using channel intermediaries offsets the inefficiencies of marketing channels. C. Marketing channel members are able to transform the assortments of products made by producers into the assortments wanted by consumers. D. Marketing channel decisions require only a​ short-term commitment. E. Using channel intermediaries increases the number of contacts with customers.

C. Marketing channel members are able to transform the assortments of products made by producers into the assortments wanted by consumers.

Channel​ members' performance should be evaluated against standards which include all of the following except​ __________. A. average inventory levels B. sales quotas C. channel management D. treatment of damaged and lost goods E. customer delivery time

C. channel management

Historically, __________ have lacked leadership and​ power, often resulting in damaging conflict and poor performance. A. vertical marketing systems B. contractual vertical marketing systems C. conventional distribution channels D. administered vertical marketing systems E. corporate vertical marketing systems

C. conventional distribution channel

​A(n) ​ __________ has no intermediary levels. A. ​manufacturer-sponsored wholesaler franchise system B. conventional distribution channel C. direct marketing channel D. indirect marketing channel E. ​manufacturer-sponsored retailer franchise system

C. direct marketing channel

When a single firm sets up two or more marketing channels to reach one or more customer​ segments, it is using​ a(n) ________. A. administered VMS B. corporate VMS C. multichannel distribution system D. contractual VMS E. franchise organization

C. multichannel distribution system

Companies now use​ ________ and supply chain management software to help​ recruit, train,​ organize, manage,​ motivate, and evaluate relationships with channel partners. A. logistics B. customer relationship management C. partner relationship management D. distribution centers E. channel management

C. partner relationship management

When setting channel​ objectives, companies should state the objectives in terms of​ ________. A. ​competitor's objectives B. the length of the channel C. targeted levels of customer service D. expected profitability E. exclusive distribution arrangements

C. targeted levels of consumer service

Which of the following is an example of horizontal channel​ conflict? A. A consumer complaining to a retailer about the service he or she received B. A consumer complaining to a producer about the quality of a product C. A retailer complaining about a​ producer's pricing D. A Ford dealer complaining that another Ford dealer is advertising in its territory E. A retailer complaining about receiving damaged goods from a wholesaler

D. a ford dealer complaining that another ford dealer is advertising in its territory Horizontal conflicts occurs among firms at the same levels of the channel Vertical conflict occurs between a retailer and producer

Producers of​ ________ typically use intensive distribution for their products. A. consumer electronics B. luxury brands C. furniture D. convenience goods E. home appliance brands

D. convenience goods

________ is a strategy in which the seller requires that dealers not handle​ competitors' products. A. Exclusive distribution B. Intensive distribution C. ​Full-line forcing D. Exclusive dealing E. Exclusive territorial agreements

D. exclusive dealing

The concept of​ __________ recognizes that providing better customer service and trimming distribution costs require teamwork. A. physical distribution management B. inventory management C. warehouse management D. integrated logistics management E. supply chain management

D. integrated logistics management

The length of a channel is indicated by the number of​ ________. A. retailers in the channel B. final consumers C. producers D. intermediary levels E. wholesalers in the channel

D. intermediary levels

From the​ producer's point of​ view, a greater number of levels of marketing channel means​ __________. A. no control and greater channel complexity B. more control and greater channel complexity C. no control and no channel complexity D. less control and greater channel complexity E. less control and less channel complexity

D. less control and greater channel complexity

Companies today are placing greater emphasis on logistics for several​ reasons, which include all of the following except​ __________. A. companies can gain a powerful competitive advantage by using improved logistics to give customers better service or lower prices B. logistics affects the environment and a​ firm's environmental sustainability efforts C. improvements in information technology have created opportunities which did not exist before D. limited product variety has created problems for logistics management E. improved logistics can yield tremendous cost savings to both a company and its customers

D. limited product variety has created problems for logistics management

One key function performed by channel members is​ ________, shaping offers to meet the​ buyer's needs, including activities such as​ manufacturing, grading,​ assembling, and packaging. A. promotion B. contact C. risk taking D. matching E. negotiating

D. matching

What is the first step in marketing channel​ design? A. Identifying the number of intermediaries to use B. Setting channel objectives C. Identifying the types of intermediaries to use D. Evaluating major channel alternatives E. Analyzing consumer needs

E. analyzing consumer needs

Channel​ members' performance should be evaluated against standards which include all of the following except​ __________. A. customer delivery time B. average inventory levels C. treatment of damaged and lost goods D. sales quotas E. channel management

E. channel management

The franchise organization is the most common type of​ __________ VMS​ (vertical marketing​ system). A. corporate B. administered C. conventional D. horizontal E. contractual

E. contractual

Sherwin-Williams sells its paint and other branded products exclusively through​ company-owned retail stores.​ Sherwin-Williams has established​ a(n) ________. A. administered VMS B. contractual VMS C. direct marketing channel D. conventional distribution channel E. corporate VMS

E. corporate VMS

A(n) ​ __________ has no intermediary levels. A. ​manufacturer-sponsored wholesaler franchise system B. ​manufacturer-sponsored retailer franchise system C. indirect marketing channel D. conventional distribution channel E. direct marketing channel

E. direct marketing channel (Mary Kay Cosmetics and GEICO)

________ is a practice whereby a producer agrees to sell a brand to a dealer only if the dealer agrees to sell some or all of the rest of its line. A. Intensive distribution B. Exclusive territorial agreements C. Exclusive dealing D. Exclusive distribution E. ​Full-line forcing

E. full-line forcing

Companies today are placing greater emphasis on logistics for several​ reasons, which include all of the following except​ __________. A. improvements in information technology have created opportunities which did not exist before B. logistics affects the environment and a​ firm's environmental sustainability efforts C. improved logistics can yield tremendous cost savings to both a company and its customers D. companies can gain a powerful competitive advantage by using improved logistics to give customers better service or lower prices E. limited product variety has created problems for logistics management

E. limited product variety has created problems for logistics management

In making products and services available to​ consumers, channel members add value. Key functions performed by the marketing channels include all of the following except​ __________. A. promotion B. matching C. negotiation D. distribution of information E. pricing

E. pricing

What are the four major functions of​ logistics? A. Inventory​ management, transportation,​ shipping, and warehousing B. ​Retailing, inventory​ management, transportation, and logistics information management C. ​Warehousing, inventory​ management, retailing, and logistics information management D. ​Warehousing, inventory​ management, transportation, and retailing E. ​Warehousing, inventory​ management, transportation, and logistics information management

E. ​Warehousing, inventory​ management, transportation, and logistics information management

contractual VMS

a VMS in which independent firms at different levels of production and distribution join together through contracts

corporate VMS

a VMS that combines successive stages of production and distribution under single ownership-channel leadership is established through common ownership

administered VMS

a VMS that coordinates successive stages of production and distribution through the size and power of one o the parties

Horizontal marketing system

a channel arrangement in which two or more companies at one level join together to follow a new marketing opportunity

conventional distribution channel

a channel consisting of one or more independent produces, wholesalers, and retailers, each a separate business seeking to maximize its own profits, perhaps even at the expense of profits for the system as a whole

vertical marketing system (VMS)

a channel structure in which producers, wholesalers, and retailers act as a unified system. one channel members owns the other, has contracts with them, or has so much power that they'll all cooperate

franchise organization

a contractual VMS in which a channel member, called a franchisor, links several stages in the production-distribution process

distribution center

a large, highly automated warehouse designed to receive goods from various plants and suppliers, take orders, fill them efficiently, and deliver goods to customers as quickly as possible

channel level

a layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer

indirect marketing channels

a marketing channel containing one or more intermediary level

direct marketing channel

a marketing channel that has no intermediary levels

value delivery network

a network composed of the company, supplier, distributors, and ultimately, customers who partner with each other to improve the performance of the entire system in delivering customer value

marketing channel (distribution channel)

a set of interdependent organizations that help make a products or service available for use or consumption by the consumer or business user

third-party logistics provider (3PL)

an independent logistics provider that performs any or all of the functions require to get a client's product to market

multimodal transportation

combining two or more modes of transportation

Marketing channel design

designing effective marketing channels by analyzing customer needs, setting channel objectives, identifying major channel alternatives, and evaluating those alternatives

channel conflict

disagreements among marketing channel members on goals, roles, and rewards -- who should do what and for what rewards

multichannel distribution system

distribution system in which a single firm sets up two or more marketing channels to reach one or more customer segments

exclusive distribution

giving a limited number of dealers the exclusive right to distribute the company's products in their territories

supply chain management

managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company resellers, and final consumers

marketing logistics (physical distribution)

planning, implementing, and controlling the physical flow of materials, final goods, and related information from points of origin to points of consumption to meet customer requirements at a profit

marketing channel management

selecting, managing, and motivating individual channel members and evaluating their performance over time

intensive distribution

stocking the product in as many outlets as possible

disintermediation

the cutting out of marketing channel intermediaries by product or service produces or the displacement of traditional resellers by radical new types of intermediaries

integrated logistics management

the logistics concept that emphasizes teamwork -- both inside the company and among all the marketing channel organizations -- to maximize the performance of the entire distribution system

selective distribution

the use of more than one but fewer than all of the intermediaries that are willing to carry the company's products