Deck 8: Channels of distribution and logistics

Question 1

Foreign legislation affecting distribution and agents is part of what is termed 'distribution culture'.

Answer 1

True

Question 2

Red markets refer to authentic and legitimately manufactured trademark items that are produced and purchased abroad but imported or diverted to the country by bypassing designated channels.

Answer 2

False

Question 3

Because only a few products are sold directly to ultimate users, an international marketer has to decide on alternative ways to move products to chosen markets.

Answer 3

True

Question 4

Carbon footprint is not as relevant as it was it the past due to more efficient international logistics.

Question 5

There are four forms of 'flow' in the channel, and they include physical, transactional, routine and information.

Question 6

Because most marketers have a vested interest in the distribution of their products, they structure the channel relationships so that they control the distribution systems from manufacturer to customer.

Question 7

The demographic and psychographic characteristics of targeted customers will form the basis for channel design decisions and, in any case, channel design refers to the length and width of the channel employed.

Question 8

The 11 'C's checklist is used to determine channel structure and relationships.Three of the factors are not controllable because the firm must adjust to existing structures.These factors are culture, competition and coverage.

Question 9

The 'trade-off' concept in international logistics is based on the notion that material flow activities can be considered only in the context of their interaction.

Question 10

Pirates no longer exist.

Question 11

Global internet penetration grew at a rate of approximately 550 per cent from 2000 to 2012.

Question 12

JIT systems are not popular in international distribution due to lower inventory costs.

Question 13

If a business depends on an outside distribution system (that may have regional or global coverage), it is considered to have intra-company links.

Question 14

Neglect of logistics issues brings only higher costs but not the risk of eventual non-competitiveness due to diminished market share, more expensive supplies or lower profits.

Question 15

The easiest approach for the firm seeking intermediaries is to consult trade directories.

Question 16

Selective coverage entails having a number of intermediaries for each area to be penetrated.

Question 17

The term 'coverage' includes the quality of the representations of a company's products.

Question 18

The importance of structuring channel relationship is further compounded by the fact that the channel decision is the most long-term of the marketing mix decisions in that, once changed, it cannot easily be dissolved.

Question 19

Channel configuration of services and consumers goods is practically the same.

Question 20

The connections made by marketing institutions are not solely for the physical movement of goods.They also serve as transactional title flows and informational communications flows.

Question 21

Which consumer characteristics of the targeted customers will form the basis for the channel design decisions?

A)Station approach and income level
B)Transactional analysis and future (predictable)categories of contingency
C)Lifetime value
D)Demographics and psychographics

Question 22

Which of the following is correct about sources of finding intermediaries?

A)The hardest approach for the firm seeking intermediaries is to consult trade directories.
B)Austrade provides tailor-made services that assist firms in identifying suitable representatives abroad.
C)Marketers should not use their websites to attract international distributors and agents as ideally they should be more proactive.
D)None of the above

Question 23

What is the most important document to the shipper, carrier and buyer?

A)Shipper export declaration
B)Bill of landing
C)Shipper agreement contract
D)Packing list

Question 24

Which of the following is incorrect? Retailers in Japan:

A)demand more from manufacturers and wholesalers than do other retailers.
B)expect wholesalers to build close relationships with their consumers.
C)expect returns of merchandise to be fully accepted even if there is no reason other than lack of sales.
D)expect significant amounts of financing and frequent delivery of products.

Question 25

The term 'distribution culture' means:

A)the language and business methods used in the supply channel.
B)the language, use of symbols and acceptable behaviour of channel members.
C)that industries tend to cluster geographically.
D)existing channel structures.

Question 26

Which of the following is not an internal determinant of channel structure and relationships?

A)Company objectives
B)Competition
C)Coverage
D)Communication

Question 27

The type of channel chosen:

A)is an administrative decision based on costing rather than profit projections.
B)directly affects the distribution culture.
C)must match the overall positioning of the product in the market.
D)None of the above

Question 28

___________ will purchase the product and will therefore exercise more ____________ than ________.

A)Distributors; independence; agents
B)Distributors; dependence; agents C Agents; dependence; distributors
D)Agents; independence; distributors

Question 29

What does the term 'channel design' mean?

A)The use of common product packaging within product families in a channel
B)The use of common texture within product families in a channel
C)The length and width of the channel employed
D)Development of the channel of communication to stockholders, particularly presentations and printed brochures

Question 30

Which of the following is not on the '11 Cs' checklist?

A)Country
B)Company objectives
C)Character
D)Capital

Question 31

Which of the following is not an advantage of a single distributor?

A)Promotional activities
B)Less noise in communication channel
C)More economical logistics flows
D)Elimination of intra-brand competition

Question 32

The more specialised, expensive, bulky or perishable is the product, and the more after-sales service it may require, the more likely:

A)the channel is relatively short.
B)the channel is relatively long.
C)multiple channels are used.
D)the channel is relatively wide.

Question 33

Which of the following is not considered a channel?

A)Direct from producer to consumer
B)Multi-level
C)Business-to-business.
D)Trade-off

Question 34

Some loss of control over the marketing of the firm's products comes from:

A)the use of intermediaries.
B)a short channel.
C)an over-taut relationship between marketer and intermediaries.
D)an intermediate channel.

Question 35

According to the textbook, six sectors are forecast to lead the way in business-to-business online transactions.Which of the following is not in the six sectors?

A)Retail
B)Shipping
C)Technological products
D)Online marketing

Question 36

Which of the following is incorrect?

A)Sometimes, management goals may conflict with the best possible channel design.
B)Starbucks invests very little capital in international expansion (less than 5 per cent of revenue), and local partners bear all business risk.
C)Coca-Cola wins increased sales at the expense of displaced competition and a much lower cost-to-serve.
D)The term 'continuity' is used to describe both the number of areas in which the marketer's products are represented and the quality of that representation.

Question 37

According to the textbook, globalisation in the distribution function is taking place in two significant ways.Distribution formats are crossing borders, especially to newly emerging markets.The second trend is:

A)that intensive and selective coverage both call for longer channels using different types of intermediaries.
B)the globalisation of consumers themselves, either independently or through strategic alliances.
C)the globalisation of retailers themselves, either independently or through strategic alliances.
D)the globalisation of intermediaries themselves, either independently or through strategic alliances.

Question 38

Channels used by competitors may be the only product distribution system that is accepted by the trade and consumers.In this case:

A)the international marketer may not be able to manipulate the distribution variable.
B)the international marketer may need to choose a partner capable of developing markets rather than one who has existing contracts.
C)developing a new distribution system is known as the 'green fields' scenario.
D)the international marketer may not be able to manipulate the distribution variable and the international marketer may need to choose a partner capable of developing markets rather than one who has existing contracts.

Question 39

Which of the following statements about the termination of channel relationships is incorrect?

A)The most typical reason for termination is changes in the international marketer's distribution approach or a (perceived)lack of performance by the intermediary.
B)Channel relationships go through a life cycle.
C)Over time, the manufacturer's marketing capabilities increase while a distributor's ability and willingness to grow the manufacturer's business in that market decreases.
D)All the alternatives are correct.

Question 40

What is the main reason to use an intermediary when introducing an internationally marketed product into a new foreign market?

A)Space reduction
B)Flighting of possible retailing expenditures
C)Relatively low-cost entry
D)Sensationalising the instalment precedent

Question 41

Two dimensions are of major importance to inventory management.They are:

A)the length of the total order cycle and its consistency.
B)the throughput volume and inventory management cost.
C)the economies of scale and economies of scope.
D)the cost and storage time.

Question 42

Elaborate on the recommended logistic optimisation method.

Question 43

_____________ is instrumental in getting the merchandise to the ultimate destination in a safe, maintainable and presentable condition.

A)Insurance
B)Shipping documents
C)Packaging
D)Bill of packaging

Question 44

Which of the following statements about transportation modes is correct?

A)Merchandise shipped via air is likely to suffer less loss and damage from exposure of the cargo to movement.
B)High-value items are more likely to be shipped by air, particularly if they have a high density.
C)Water transportation is a key mode for international freight movements.
D)All of these choices

Question 45

Which of the following statements about pirates is correct?

A)Pirates are no longer relevant due to ships with a more advanced security systems.
B)Tracking down pirates is relatively cheap.
C)In spite of large corporate investments to build security, new attacks happen daily.
D)South American shores represent the greatest danger to shipping companies.

Question 46

The distributor's existing product lines should be analysed along four dimensions.Which of the following is not one of the four dimensions?

A)Competitiveness
B)Compatibility
C)Complementary nature
D)Brand assets.

Question 47

Three types of vessels operating in ocean shipping can be distinguished by their service.__________ offers regularly scheduled passage on established routes._________ mainly provides contractual services for individual voyages or prolonged periods of time.__________ is available for irregular routes and is scheduled only on demand.

A)Tramp service; Liner service; Bulk service
B)Bulk service; Tramp service; Liner service
C)Liner service; Bulk service; Tramp service
D)Thin service; Bulk service; Tramp service

Question 48

Which category of export marketing strategy requires the marketer to make an investment into the foreign market for the purpose of selling its products in that market or more broadly?

A)Indirect exporter
B)Direct exporter
C)Integrated distribution
D)Agents

Question 49

Which of the following is not an advantage of a single distributor?

A)One corporate presence eliminates confusion among buyers and local officials.
B)Communication is less plagued by noise.
C)Logistics flows are more economical.
D)Marketing programs are cheaper.

Question 50

Which of the following is a criterion for selecting intermediaries?

A)Reputation
B)Profitability
C)Organisation type
D)Profitability and organisation type

Question 51

What are the three different approaches for coverage that are available to the international marketer?

Question 52

According to the textbook, which of the following is conducive to more direct sales?

A)Intensive coverage
B)Selective coverage
C)Exclusive coverage
D)Inclusive coverage

Question 53

The expenditure incurred in maintaining a channel once it is established is referred to as:

A)continuity.
B)cost.
C)cash flow.
D)net present pricing.

Question 54

Locating a warehouse near the customer may reduce the cost of transportation.This is an example of what type of concept?

A)Total cost concept
B)Profit maximisation concept
C)Cost-based concept
D)Trade-off concept

Question 55

What is your opinion about future innovative approaches to international distribution?

Question 56

The ________________minimises the firm's overall logistics cost within the entire system.Its implementation requires that the members of the system understand the sources of costs.

A)total cost concept
B)profit maximisation concept
C)cost-based concept
D)trade-off concept

Question 57

Parallel importation refers to authentic and legitimately manufactured trademark items that are produced and purchased abroad but imported or diverted into a country by bypassing designated channels.What type of market is this?

A)Subversive
B)Sub-governmental
C)Grey.
D)Black