Deck 9: Information Systems and Supply Chain Management

Question 1

Which of the following is not a benefit of efficient supply chain management?

A) Increase in product availability
B) Decrease in inventory turnover
C) More tailored assortments
D) High return on investments
E) Sustainable competitive advantage

Answer 1

B
All are benefits except decrease in inventory turnover. Inventory is increased by having better tailored assortments per store, resulting in increased product availability and a higher ROI, and leading to a sustainable competitive advantage.

Question 2

Vendor-managed inventory (VMI) is an approach for improving supply chain efficiency in which the vendor is responsible for maintaining the retailer's inventory levels.

Answer 2

True
Vendor-managed inventory (VMI) is an approach for improving supply chain efficiency in which the vendor is responsible for maintaining the retailer's inventory levels.

Question 3

A(n) ________ occurs when an SKU that a customer wants is not available.

A) overstock
B) B-stock
C) obsolescence
D) excess supply
E) stockout

Answer 3

E
A stockout occurs when an SKU that a customer wants is not available.

Question 4

An efficient supply chain and information system can improve a retailer's return on assets (ROA) because the system

A) increases sales and net profit margins, without increasing inventory.
B) increases sales and net profit margins by increasing inventory.
C) reduces sales, but increases net profit margins by increasing inventory.
D) reduces net profit margins, but increases sales by increasing inventory.
E) reduces net profit margins by festering sales, without increasing inventory.

Question 5

Jane visits the local supermarket to purchase caviar for a dinner party. Upon enquiry, she finds out that caviar is sold out. Which of the following terms best describes this situation?

A) Stockout
B) Excess supply
C) Overstock
D) B-stock
E) Obsolescence

Question 6

Drop shipping is the process of capturing value from and/or properly disposing of merchandise returned by customers and/or stores.

Question 7

________ is a set of activities and techniques firms employ to efficiently and effectively manage the flow of merchandise from the vendors to the retailer's customers.

A) Enterprise feedback management
B) Supply chain management
C) Total quality management
D) Customer relationship management
E) Employee experience management

Question 8

Bloomsberry LLC, a fashion retailer, periodically updates their collection of apparel. Woolen apparel is stocked during winter, and cotton apparel is stocked during summer. Which of the following is this an example of?

A) Stockout
B) B-stock
C) Unique merchandise
D) Tailored assortments
E) Clearance sale

Question 9

Radio frequency identification (RFID) is a technology that allows an object or person to be identified at a distance by means of radio waves.

Question 10

Which of the following is a benefit of efficient supply chain management?

A) Decrease in inventory turnover
B) Increase in product availability
C) Increase in turnaround time
D) Increase in organizational turnover
E) Decrease in cross selling

Question 11

Electronic data interchange (EDI) is a set of activities and techniques firms employ to efficiently and effectively manage the flow of merchandise from the vendors to the retailer's customers.

Question 12

Floor-ready merchandise is merchandise that is ready to be placed on the selling floor.

Question 13

In a pull supply chain, there is less likelihood of being overstocked or out of stock because the store requests for merchandise are based on customer demand.

Question 14

Which of the following is not a reason why an efficient supply chain is important to retailers?

A) Improved product availability
B) Higher return on investment
C) Strategic advantage
D) Trendier merchandise
E) Improved in-stock position

Question 15

Overall, effective supply chain management results in higher gross margins and lower turnover of inventory.

Question 16

An advance shipping notice (ASN) is a document that tells the DC what specifically is being shipped and when it will be delivered.

Question 17

Which of the following is a typical reaction that customers exhibit when experiencing multiple stockouts?

A) Switching to another retailer
B) Patronizing the retailer
C) Promoting the retailer on social media
D) Initiating litigation against the retailer
E) Reviewing product attributes

Question 18

The pick ticket is a document or display on a screen in a forklift truck that indicates how many cartons to get from specific storage areas.

Question 19

Fewer stockouts and tailored assortments translate into

A) lower sales.
B) higher costs.
C) higher inventory turnover.
D) higher prices for retailers.
E) lower employee productivity.

Question 20

Cross-docking is when vendors ship merchandise prepackaged in the quantity required for each store; when the products arrive to the distribution center, the products move to the staging area to be shipped to the designated stores.

Question 21

Retailers can use ________ to arrange for the storage and shipping of their merchandise.

A) dispatchers
B) freight forwarders
C) integrated third-party logistics companies
D) reverse logistic companies
E) public warehouses

Question 22

The retailer's order is transmitted to the distribution system via computers. Then, the computer at the distribution center creates a ________, a document or display on a screen in the forklift truck that indicates how many cartons to get from specific storage areas.

A) selection order
B) pick ticket
C) requisition order
D) sorting order
E) selection list

Question 23

When a regular customer calls a well-known pizza delivery restaurant, the order-taker types in the caller's name. The computer screen shows the customer's address, phone number, directions to his or her house, his or her usual order, and the date and frequency of orders. If the customer has not ordered during a two-month period, or the average number of orders has been down, then the pizza parlor mails them a coupon of their favorite pizza. Which of the following does the pizza parlor use?

A) Data warehouse
B) Data scrapping
C) Web scrapping
D) Direct marketing
E) Direct account management

Question 24

Ali supervises the conveyor belts in a distribution center. Her job is to make sure the merchandise moves quickly from the receiving docks to the staging area in order for the trucks to load and deliver. No merchandise is stored, as the vendors already prepared it specifically for the stores. Ali handles ________ at the distribution center.

A) ticketing
B) cross-docking
C) cataloging
D) marking
E) reverse logistics

Question 25

________ is the computer-to-computer exchange of business documents from the retailer to the vendor, and vendor to retailer.

A) Automated replenishment system
B) Universal Product Code (UPC) system
C) Electronic data interchange (EDI) system
D) Point of sale (POS)
E) Collaborative planning, forecasting, and replenishment (CPFR)

Question 26

How do retailers and vendors ensure that the information that passes back and forth between them is secure?

A) Paper hard copies are sent back and forth for comparison to be certain that the information is accurate.
B) Suppliers, customers, and new clients all have a form of access to information.
C) With a high level of planning, implementation, and control of the flow of information, the information will be secure.
D) There is an element of trust that is necessary in doing business with one another.
E) The system ensures that the information received has not been tampered with by ensuring that the communication is both authentic and authorized.

Question 27

Which of the following statements about receiving, checking, marking, and ticketing is True?

A) Only receiving and checking involve UPC labels.
B) It is more efficient and less costly to ticket merchandise at the store level.
C) It is more efficient for a retailer to perform ticketing and marking at a DC than in its stores.
D) To perform the checking process correctly, every carton must be opened and its merchandise examined.
E) The checking process is performed after the merchandise has been ticketed and marked.

Question 28

Which of the following is a function of a distribution center?

A) Negotiating with vendors
B) Providing technical support for products
C) Providing after-sale service
D) Managing inbound transportation
E) Managing customer support

Question 29

A(n) ________ is a document that tells the DC what specifically is being shipped and when it will be delivered.

A) Universal product code (UPC)
B) Radio frequency identification (RFID)
C) Advanced shipping notice (ASN)
D) Shipping document
E) Bill of lading (BOL)

Question 30

Sara, who works at WorldFly LLC, is responsible for coordinating deliveries to the distribution center. Which of the following terms best describes Sara's role?

A) Dispatching
B) Receiving
C) Checking
D) Ticketing
E) Marking

Question 31

The process where vendors ship the merchandise prepackaged to the distribution center in the quantities required for each store and then that merchandise is shipped to stores as soon as it is received is called

A) ticketing.
B) cross-docking.
C) push supply.
D) pull supply
E) reverse logistics.

Question 32

In an efficient supply chain and information system, net sales increase because

A) customers are offered heavy discounts on the products.
B) customers are offered tailored assortments that are in stock.
C) retailers get tax benefits for setting up the system.
D) retailers are offered heavy discounts by their suppliers.
E) retailers prohibit customers from window shopping.

Question 33

Which of the following statements is True of a dispatcher's role?

A) Dispatchers are responsible for packaging and quality control.
B) Dispatchers allocate warehouse space to merchants.
C) Dispatchers create pick tickets.
D) Dispatchers make pricing and identification labels and place them on merchandise.
E) Dispatchers coordinate deliveries to the distribution centers.

Question 34

Each time a customer makes a purchase at a Walmart store from the health and beauty area, data is transmitted to the nearest distribution center so the merchandise can be replenished and sent on the next truck delivery. Which of the following strategies does Walmart utilize?

A) Cross check logistic strategy
B) Pull supply chain
C) Cost-efficient logistic strategy
D) Push supply chain
E) Influential logistic strategy

Question 35

Which of the following is not a function of a distribution center?

A) Managing inbound transportation
B) Storing and cross-docking
C) Receiving and checking
D) Getting merchandise floor-ready
E) Negotiating with vendors

Question 36

________ technology is a wireless network and a mobile device that receives demand notification and enables a speedy response. This solution allows the associate closest to the ordered item to physically pull it and verify its availability.

A) Mobile task management
B) EDI
C) CPFR
D) VMI
E) Data warehouse

Question 37

When inventory levels, inventory investment, and total assets are low,

A) asset and inventory turnovers are low.
B) asset turnover is high but inventory turnover is low.
C) asset and inventory turnovers are high.
D) asset turnover is low but inventory turnover is high.
E) asset and inventory turnover cannot be predicted.

Question 38

Which of the following statements is not a benefit of EDI to retailers and their vendors?

A) EDI reduces cycle time.
B) Information flows quicker, so inventory turnover is higher.
C) It improves overall quality of communications.
D) It is a computer readable format that can be easily analyzed.
E) EDI increases the desirability of the product for the end consumer.

Question 39

Purchase data collected at the point of sale goes into a huge database known as a

A) spreadsheet.
B) computerized processing unit.
C) electronic data interchange.
D) database chain.
E) data warehouse.

Question 40

Which of the following statements is a method for improving net profit margin?

A) It can be improved by decreasing the gross margin and lowering sales.
B) It can be improved by decreasing the gross margin and increasing expenses.
C) It can be improved by decreasing the net margin and lowering expenses.
D) It can be improved by increasing the gross margin and lowering expenses.
E) It can be improved by increasing the net margin and lowering sales.

Question 41

Which of the following statements describes the benefits of a pull strategy?

A) It does not require advanced systems for implementation.
B) It decreases inventory turnover.
C) There is less likelihood of being overstocked or out of stock at each store.
D) It allows more efficient production and distribution scheduling to increase costs.
E) It forecasts the competitor's demand.

Question 42

From the retailer's view, ________ reduces the retailer's supply chain costs and investment because the vendor assumes the costs and risks of shipping the product to the customer.

A) drop shipping
B) push supply chain
C) pull supply chain
D) reverse logistics
E) direct store delivery

Question 43

An inventory planner notes that the inventory she is responsible for would be best managed by relying on consumer demand. She recommends to her management to implement a(n) ________ that would support being in a better stock position of her managed product by store location.

A) cross check logistic strategy
B) pull supply chain strategy
C) cost-efficient logistic strategy
D) push supply chain strategy
E) influential logistic strategy

Question 44

What is the process of moving merchandise through the channel from the customer to the store to the DC to the vendor?

A) Return flow
B) Reverse supply chain
C) Outbound returns
D) Outbound flow
E) Reverse flow

Question 45

________ is a term used for when a retail associate scans the merchandise the customer intends to purchase.

A) Point of sale
B) Consumer direct fulfillment
C) Quick response
D) Just-in-time delivery
E) Lightening logistics

Question 46

Matthew made a purchase online of a Fender speaker system from a retailer. When the shipment of his purchase arrived at his home, he noticed that the product was shipped to him directly from Fender. The retailer and vendor are utilizing a system of

A) drop shipping.
B) cross-docking.
C) outsourcing.
D) third party logistics.
E) vendor managed inventory.

Question 47

Which of the following statements does not describe the benefits of utilizing distribution centers over direct store delivery?

A) More accurate sales forecasts are possible when retailers combine forecasts for many stores serviced by one distribution center rather than doing a forecast for each store.
B) Distribution centers enable the retailer to carry less merchandise in the individual stores.
C) The use of distribution centers increases inventory investment.
D) It is easier to avoid running out of stock or having too much stock in any particular store because merchandise is ordered from the distribution center as needed.
E) The effects of forecast error for the individual stores are minimized and less backup inventory is needed to prevent stockouts.

Question 48

A vendor that employs sales associates for retailers to visit stores, analyze their business and inventory, and create displays of their products will most likely also utilize what method of product delivery?

A) Direct store delivery
B) Consumer direct fulfillment
C) Drop-shipping
D) Cross-docking
E) Reverse logistics

Question 49

In a(n) ________, merchandise is allocated to stores on the basis of forecasted demand.

A) push supply chain
B) cross check logistic strategy
C) influential logistic strategy
D) pull supply chain
E) cost-efficient logistic strategy

Question 50

Which of the following terms describes the process of moving returned goods from a customer to a retail store or FC, from a retail store to a DC, or from a DC to a vendor for the purpose of capturing value or proper disposal?

A) Ticketing
B) Reverse supply chain
C) Marking
D) Cross-docking
E) Exception management logistics

Question 51

Which of the following statements does not describe the benefits of a pull strategy?

A) There exists less likelihood of being overstocked or out of stock because the store orders merchandise as needed on the basis of consumer demand.
B) It increases inventory turnover.
C) It is more responsive to changes in customer demand.
D) It becomes more efficient than a push approach when demand is uncertain and difficult to forecast.
E) All of these statements are benefits of a pull strategy.

Question 52

For fashion merchandise where there is only one shipment of the product or collection, the best supply chain method to use is the

A) cross check logistic strategy.
B) pull supply chain strategy.
C) cost efficient logistic strategy.
D) push supply chain strategy.
E) influential logistic strategy.

Question 53

________ is a method where retailers receive orders from customers and have the product shipped directly to the customer from the vendor.

A) Consumer direct fulfillment
B) Reverse logistics
C) Pull supply chain
D) Push supply chain
E) Direct store delivery

Question 54

Retailers with less sophisticated forecasting and information systems tend to use a(n)

A) cost efficient logistic strategy.
B) cross check logistic strategy.
C) influential logistic strategy.
D) pull supply chain.
E) push supply chain.

Question 55

Which of the following statements is an advantage of using distribution centers over direct store delivery?

A) Individual stores that forecast and draw from a DC are more cost efficient.
B) The DCs have the advantage of keeping extra merchandise as backup stock in the store.
C) Direct store delivery is always more expensive.
D) The DCs enable the retailer to carry less overall inventory.
E) The DC can always deliver faster than a vendor.

Question 56

What happens when retailers and vendors do not coordinate their supply chain management activities?

A) Prices drop at the negotiation level.
B) Communication improves.
C) The DC shuts down.
D) Excess inventory builds up in the system.
E) Lower inventory leads to sell-outs.

Question 57

Which of the following types of retailers is most likely to benefit from the use of direct store delivery?

A) A big-box electronics retailer
B) A supermarket
C) A big-box discount store
D) A large department store
E) A mall specialty store

Question 58

A retailer whose orders are generated at the store level on the basis of sales data captured by point-of-sale terminals is said to employ a(n):

A) cost efficient logistic strategy.
B) pull supply chain.
C) influential logistic strategy.
D) cross check logistic strategy.
E) push supply chain.

Question 59

When the law office of Dewey, Cheatham, and Howe received the case of legal paper it had ordered from an Internet office supply retailer, the office manager was dismayed to find the paper was pink even though it was marked white. The office manager packed the paper and sent it back to the retailer who in turn sent it back to the vendor. This is an example of

A) resourcing.
B) backwards distribution.
C) a reverse supply chain.
D) backwards handling.
E) demarketing.

Question 60

Many companies who deliver their own product to their stores through their own trucks are using ________ as a way to offset expenses by picking up loads to transport on their way back, rather than traveling with empty trailers.

A) bullwhips
B) dual directionals
C) boomerangs
D) deferred transportation
E) backhauls

Question 61

Which of the following is not a benefit of using RFID over traditional bar codes?

A) Reduced inventory turnover.
B) RFID updates the data stored.
C) RFID holds more data stored on the device.
D) One benefit of item-level RFID is to reduce theft.
E) The data on the devices can be acquired without a visual line of sight.

Question 62

What are the activities that take place at a distribution center?

Question 63

Because of the nature of vendor-managed inventory,

A) retail buyers and planners no longer need to monitor inventory levels and place orders.
B) DCs need to run around the clock as deliveries arrive after hours and on holidays.
C) there are many delays in replenishment as it's not a collaborative approach.
D) third party logistic companies have become necessary.
E) EDI is now obsolete.

Question 64

Which of the following statements is True of radio frequency identification devices?

A) They facilitate interpersonal communication between vendors and retailers.
B) They transmit data about the objects in which they are embedded.
C) They help in gathering data about the spending habits of customers.
D) They facilitate interpersonal communication between retailers and consumers.
E) They help in gathering data about the preferences of customers.

Question 65

Which of the following is the primary benefit to retailers of utilizing RFID tagging for individual items?

A) Increased inventory turnover
B) Reduced product prices
C) Reduced inventory turnover
D) Real-time measure of employee productivity
E) Real-time measure of inventory levels

Question 66

________ is an approach for improving supply chain efficiency in which the vendor is responsible for maintaining the retailer's inventory levels in each of its stores.

A) Efficient consumer response (ECR)
B) Reverse logistics
C) Quick Response (QR) system
D) Vendor-managed inventory (VMI)
E) Collaborative planning, forecasting, and replenishment (CPRF)

Question 67

Explain how managing an efficient supply chain and information system can improve the company's return on assets.

Question 68

All of the following are reasons why more attention is being directed toward reverse supply chain systems except

A) the increased rate of returns overall due to the increase of retail sales on the Internet.
B) the government restrictions on how many times a customer can return products to a retailer.
C) the environmental sustainability of excess packaging and shipping materials when returned.
D) consolidating shipments to stores, DCs, and FC to reduce harmful emissions.
E) the environmental impact of shipping direct to customers.

Question 69

What is "floor-ready" merchandise, and what tasks are completed at the distribution center to prepare merchandise to be "floor ready"?

Question 70

What is the purpose of the data warehouse and how do retailers use it?

Question 71

What is an advantage of using RFID over traditional bar codes?

A) RFID eliminates the bullwhip effect.
B) RFID technology is expensive.
C) RFID holds more data stored on the device.
D) RFID makes tagging and pricing at DCs unnecessary.
E) RFID is environmentally friendly.

Question 72

What are the benefits of RFID technology over traditional bar codes?

Question 73

Compare and contrast the push and pull supply chain methods.

Question 74

Which of the following is not a way to reduce the level of inventory in the supply chain and the number of stockouts in the stores?

A) Using EDI
B) Sharing information
C) Using reverse logistics
D) Using vendor-managed inventory (VMI)
E) Employing collaborative planning, forecasting, and replenishment (CPRF)

Question 75

Which of the following statements is a reason why some vendors and retailers chose not to adopt RFID tagging?

A) They are concerned about the data storage falling into the wrong hands.
B) They are concerned about the potential health risk of radio frequency.
C) They believe the additional costs do not benefit the return on investment.
D) They do not want to replace people with the devices.
E) They are concerned about the environmental impact.

Question 76

________ is the sharing of forecasts and related business information between retailers and vendors to improve supply chain efficiency and product replenishment.

A) Automated replenishment system
B) Universal Product Code (UPC) system
C) Electronic data interchange (EDI) system
D) Point-of-sale (POS)
E) Collaborative planning, forecasting, and replenishment (CPFR)

Question 77

________ are tags that transmit identifying information and are attached to individual items, shipping cartons, and containers.

A) Vendor-managed inventories
B) Data warehouses
C) Radio frequency identification devices
D) Electronic data interchanges
E) Data stores

Question 78

Identify and describe the vendor-managed inventory approach.

Question 79

Which of the following describes the limitations of vendor-managed inventory that retailers may encounter?

A) Since the vendor owns the merchandise until it is sold by the retailer, at which time the retailer pays for the merchandise, a retailer bears a financial risk.
B) Retail buyers and planners need to monitor inventory levels.
C) When the vendor coordinates the supply chain for its specific products, it does not know what other actions the retailer is taking that might affect the sales of its products in the future.
D) It takes longer for a product to go from design to ordering the product to having the product on the selling floor.
E) It is an added cost with little benefit for the retailer.

Question 80

CPFR partnerships require

A) quick response interaction.
B) trust and commitment.
C) two or more vendors.
D) full responsibility of the vendor.
E) a controlled expense budget.