Deck 14: Marketing Channels and Supply Chain Management

Question 1

McKesson Company provides health care products to pharmacies. For example, it purchases bandages, gauze, antibacterial cream, and ointments (or anything else you would need to treat a cut or scrape) from a variety of different manufacturers. Its goal is to provide each pharmacy with every item a customer might want to treat a cut. What is McKesson overcoming to aid consumers?

A)spatial discrepancy
B)discrepancy of quantity
C)discrepancy of assortment
D)discrepancy of possession

Answer 1

C

Question 2

Aspen Furniture operates only one manufacturing plant in Edmonton, although it has end-customers in both Asia and Europe. What type of discrepancy has been created?

A)spatial
B)temporal
C)assortment
D)quantity

Answer 2

A

Question 3

Cutter & Buck is a high-end fashion sportswear company. Even though swimwear is a product category that does not sell year-round, its sales remain steady all year because Cutter & Buck sells to wholesale distributors that stock the product. Which type of discrepancy are its wholesale distributors helping to overcome?

A)spatial
B)possession
C)quantity
D)temporal

Answer 3

D

Question 4

Walmart offers many product categories under one roof. This reduces the number of stores customers must shop in to complete their purchases. In this case, what does Walmart provide?

A)horizontal integration.
B)contact efficiency
C)vertical integration
D)reciprocity

Question 5

How can marketing channels achieve economies of scale?

A)through overcoming spatial discrepancies
B)through contact expertise
C)through producing large quantities of a single product
D)through overcoming discrepancies of quantity

Question 6

R.H. Kurt & Son Inc. distributes rifles for hunting and target shooting to sporting equipment retailers and many large discount stores. It carries products from 41 different manufacturers. What is its marketing channel composed of?

A)any organization that had a part in moving the product from the distributor to the retailer
B)the functions of transportation, storage, inventory control, materials handling, and order processing
C)the 41 different manufacturers, R.H. Kurt, the retailers it serves, and their customers
D)the trucking companies that deliver the rifles

Question 7

R.H. Kurt & Son, Inc., distributes rifles for hunting and target shooting to sporting equipment retailers and many large discount stores. Customers at retail stores want only one rifle or one scope. They do not want to buy in the quantities the manufacturers need to sell. Which of the following discrepancy can be overcome by the marketing channels?

A)discrepancy of quantity
B)spatial discrepancy
C)discrepancy of assortment
D)discrepancy of facilitation

Question 8

Walmart sells all over the globe and is currently considering manufacturing its own line of computers. Keeping this in mind, how can they attain economies of scale?

A)through overcoming spatial discrepancies
B)through specialization and division of labour
C)through contact expertise
D)through overcoming discrepancies of quantity

Question 9

To facilitate manufacturing in India, Tata Automotive uses many different local suppliers of key component parts. What are these suppliers part of for Tata Automotive?

A)its communication network
B)its channel of distribution
C)its supply pyramid
D)its demand chain

Question 10

A manufacturer may produce only one product, yet additional products may be required to actually use the first product. What does this create?

A)a discrepancy of quantity
B)a discrepancy of assortment
C)a spatial discrepancy
D)a temporal discrepancy

Question 11

YKK slide fasteners (zippers) are made in Brandon, Manitoba, yet manufacturers all over the world use YKK zippers to manufacture clothes, luggage, shoes, and other items. Which type of discrepancy do wholesalers around the world primarily help to overcome?

A)creation
B)temporal
C)assortment
D)spatial

Question 12

What is the term for a business structure of interdependent organizations that reaches from the point of product origin to the consumer?

A)a marketing mix channel
B)a selective distribution channel
C)a marketing channel or channel of distribution
D)a transportation channel or channel of movement

Question 13

Virtual Supermarket only sells Aunt Jemima pancake mix. Once customers have purchased the mix, they must purchase their syrup, butter, knives, forks and plates somewhere else. What has Virtual Supermarket created?

A)a discrepancy of assortment
B)a spatial discrepancy
C)a temporal discrepancy
D)a discrepancy of possession

Question 14

Ontario Natural Food is a grocery wholesale cooperative, it provides all kinds of meats, cereals, canned and fresh fruits and vegetables, beauty aids, healthcare items, and pet products to the supermarkets in its channel. What is Ontario Natural Food overcoming to aid its customers?

A)spatial discrepancy
B)discrepancy of quantity
C)discrepancy of assortment
D)demand discrepancies

Question 15

Taco Bell sells Mexican-style food using various channels of distribution. Beef and vegetables are key ingredients used by Taco Bell. What are beef producers, vegetable growers, Taco Bell, and consumers part of?

A)a marketing system
B)a transportation channel
C)a marketing channel
D)a logistics system

Question 16

In order to achieve low unit costs, Logitech Electronics has only produced 1000 computer mice. It's wholesale customers want to buy at least 1500 units. What has the quantity produced to achieve low unit costs created?

A)a discrepancy of quantity
B)a discrepancy of assortment
C)a discrepancy of accumulation
D)a discrepancy of possession

Question 17

Vicobello is a major manufacturer of outdoor fountains that are currently popular in gardens. Even though fountains represent a product category that does not sell year-round due to inclement weather, Vicobello's sales remain steady all year because it sells to wholesale distributors that stock the product. Which type of discrepancy are its wholesale distributors primarily helping to overcome?

A)assortment
B)possession
C)quantity
D)temporal

Question 18

When a consumer goes to a sporting goods store to buy a rifle scope and cleaning equipment and discovers the store does not carry rifle scopes, what is created that results in the consumer dissatisfaction?

A)discrepancy of quantity
B)discrepancy of assortment
C)spatial discrepancy
D)discrepancy of possession

Question 19

Quaker Oats can efficiently produce its Aunt Jemima instant pancake mix at a rate of 5000 units in a typical day. What has the quantity produced to achieve low unit cost led to?

A)a discrepancy of assortment
B)a temporal discrepancy
C)an efficient supply chain
D)a discrepancy of quantity

Question 20

Cianin Limited, a Christmas decoration manufacturer, produces its products all year round despite the fact that customers are not ready to buy their products until Christmas. What kind of discrepancy has been created?

A)quantity
B)possession
C)temporal
D)assortment

Question 21

Indian automobile manufacturer, Tata Motors is considering selling in Canada. Which one of the following would best determine the type of intermediary Tata use in Canada?

A)product characteristics, buyer consideration, and market characteristics
B)competitive conditions, economic characteristics, and government regulations
C)product form, size, and political considerations
D)product shape, manufacturing technology, and staff skills

Question 22

The only way Jim Keeler in British Columbia can get a box of Carolyn Popwell's Festive Holiday Truffles from Washington is to order it through the mail from Popwell. What type of channel is this?

A)wholesaler
B)agent/broker
C)reciprocal
D)direct

Question 23

Which of the following activities is NOT a transactional channel function?

A)contacting buyers
B)promoting the products to be sold
C)taking the risks associated with product inventories
D)physical distribution and sorting

Question 24

Which of the following are examples of facilitating functions performed by wholesaling intermediaries?

A)sorting and storing
B)risk taking and promotion
C)assorting, accumulating, grading, and allocating
D)researching and financing

Question 25

Which type of intermediaries are retailers and merchant wholesalers?

A)those that take title to a product
B)those that create temporal and spatial discrepancies
C)those that use consumer promotions
D)those that do not benefit from any economies of scale

Question 26

Which of the following logistical activities do marketing channels perform?

A)transporting
B)promoting
C)negotiating
D)risk taking

Question 27

What is the major characteristic used to differentiate between types of intermediary categories?

A)whether they prevent specialization of labour
B)whether they decrease economies of scale
C)whether they take title to the products they sell
D)whether they raise profit margins for independent middlemen

Question 28

Which channel is typically used between a supplier and manufacturer of industrial products?

A)direct
B)industrial merchant
C)wholesaler
D)retailer

Question 29

Although Acer Computers manufactures thousands of units per year, its wholesale customers are able to purchase smaller more manageable quantities. What is this called?

A)allocating
B)accumulation
C)storing
D)downsizing

Question 30

Long Island Lefty provides retailers and other businesses with the latest and the best products for left-handed consumers. It buys all types of products from a variety of manufacturers and stores the merchandise in its New York warehouse until purchased by buyers. Long Island Lefty does not sell to end users. What is Long Island Lefty an example of?

A)agent or broker
B)retailer
C)merchant wholesaler
D)industrial supplier

Question 31

Which of the following are wholesaling intermediaries that facilitate the sales of a product from producer to end user by representing retailers and manufacturers and sometimes wholesalers, without providing much input as to the terms of the sale?

A)marketing facilitators
B)channel cooperatives
C)agents and brokers
D)merchant wholesalers

Question 32

Which of the following is NOT a sorting activity?

A)assorting
B)accumulation
C)allocation
D)possession

Question 33

What are the three basic functions performed by channel intermediaries?

A)transactional, logistical, and facilitating
B)contacting, negotiating, and ownership
C)promoting, distributing, and bulk breaking
D)assorting, accumulating, and allocating

Question 34

W.W. Grainger Inc. is one of the world's largest business-to-business distributors of equipment, component parts, and supplies in the United States and Canada. It has ownership title to over 220,000 products, which are stocked in one national and nine regional warehouses to guarantee product availability and quick service to the many manufacturers that are its customers. What is W.W. Grainger an example of?

A)agent or broker
B)merchant wholesaler
C)retailer
D)industrial manufacturer

Question 35

Dell computers sells to end-users. They use no other intermediary. What kind of channel do they use?

A)a limited distribution system
B)a vertical marketing system
C)a reciprocal channel
D)a direct channel

Question 36

Desk manufacturer Office-Pro wants to route its new line of desks from the company to the end-user. Which of the following would they typically NOT use?

A)retailer
B)industrial distributor
C)producer
D)wholesaler

Question 37

EWEL buys goods from manufacturers, takes title to these goods, and resells them to businesses and retailers? What are they an example of?

A)merchant wholesaler
B)drop shipper
C)channel cooperative
D)marketing cooperative

Question 38

Surj has just inherited his small family farm. He is new to the business and knows little about finding customers for cattle as well as wheat grown on the farm. What channel type would you recommend he use?

A)agent/brokers
B)wholesale distributers
C)retail specialists
D)national grocery chains

Question 39

Vicobello is a manufacturer of outdoor fountains that are currently popular in gardens. Even though fountains represent a product category that does not sell year-round due to inclement weather, Vicobello's sales remain steady all year because it sells to wholesale distributors that stock the product. Which type of function do the wholesale distributors perform for Vicobello?

A)financial
B)facilitating
C)logistical
D)promotional

Question 40

Which of the following includes managing the movement of raw materials and parts from their sources to production sites; managing the movement of materials, semi-finished, and finished products within and among plants, warehouses, and distribution centres; and the planning and coordinating of the physical distribution of finished goods to intermediaries and final buyers?

A)logistics
B)materials handling
C)intermodal transportation
D)contract logistics

Question 41

Tim Horton coffee shops can often be found at Walmart Superstores. What is this an example of?

A)strategic channel alliance
B)relationship channel
C)reverse channel
D)multiple distribution alliance

Question 42

When the new father left the maternity ward to find something to eat, he was surprised to see he could buy McDonald's fast food in the hospital dining room. What is McDonald's utilizing?

A)logistical distribution alliance
B)a nontraditional channel
C)multiplicative channels
D)a licensing alliance

Question 43

Which of the following best describes agents and brokers?

A)They have a great deal of control and risk invested in the goods.
B)They represent only manufacturers in sales situations.
C)They generally are on an annual salary with the manufacturer.
D)They do not take title to merchandise.

Question 44

Centigon is a manufacturer of customized armoured vehicles for military, private, presidential, and commercial uses. Each armoured vehicle is designed to deliver security on the road while also achieving optimum levels of performance and comfort. For distribution, what would you expect Centigon to use?

A)a horizontally integrated channel
B)a reciprocal system
C)a direct channel
D)a vertical marketing system

Question 45

Scenario 14-1
Selfridges is the second-largest department store in Great Britain. It works with House of Frasier, one of its competitors, to reduce operating costs by sharing channels of distribution to ship goods from more than 1,500 suppliers.
Refer to the scenario. In choosing a channel of distribution, Selfridges more than likely relied on which of the following?

A)market factors
B)ownership requirements
C)production factors
D)geodemographic requirements

Question 46

Ford SYNCis a factory-installed, integrated in-vehicle communications and entertainment systemdeveloped by Microsoft. What are the two companies engaged in?

A)vertical conflict
B)an integrated supply chain
C)a strategic channel alliance
D)forward integration

Question 47

Canesta Company has developed a virtual keyboard out of light to be used with cell phones and personal digital assistants (PDAs). The product beams an image of a keyboard on a desk, allowing the user to type on the image. The words are picked up by the user's digital device. When introduced to the market, the device will sell for less than $50. Canesta does not have any retail channels. What level of distribution intensity should the company use?

A)exclusive
B)extensive
C)reciprocal
D)selective

Question 48

When Delphi-Grundig, a manufacturer of state-of-the-art car radios, decided to expand its marketing efforts into countries in which its products are not currently available, it did not have the time or resources to spend on developing new channels of distribution. What should Delphi-Grundig consider using?

A)an industrial distributor
B)a franchising system
C)a strategic channel alliance
D)a channel cooperative

Question 49

Sherwin-Williams Company has not only grown to be the largest producer of standard and custom paints and coatings in Canada and the United States, but is among the largest producers in the world. For distribution, what would you expect Sherwin-Williams to use?

A)a network of facilitating agents
B)a horizontally integrated channel
C)a direct channel
D)a vertical marketing system

Question 50

The Lamp Company sells standardized light bulbs to other businesses. The average bulb only costs around $1.50. What channel would you recommend they use to get their products to their customers?

A)non-traditional channels
B)industrial distributors
C)agents and brokers
D)retailers

Question 51

What is Taco Bell using when it sells its products to students through school cafeterias?

A)an agent/broker channel
B)multiple channels
C)a nontraditional channel
D)a strategic channel alliance

Question 52

Which of the following statements best illustrates how market factors affect channel decisions?

A)Industrial customers tend to buy in larger quantities and require more customer service.
B)Geographically concentrated target markets should be served with an indirect sales force.
C)Widely dispersed markets require fewer intermediaries.
D)A very large market requires fewer intermediaries.

Question 53

After years of phenomenal growth, Taco Bell is branching out from traditional single-purpose stores. Its uses kiosks, movable carts in malls and at the gas station, products on supermarket shelves, and even in-school lunch programs. In only a few years, it has more than quintupled its points of access. It aims to have 200,000 outlets; most of which will be nontraditional. What type of distribution does Taco Bell appear to be moving toward to get its products to market?

A)intensive
B)selective
C)market-focused
D)exclusive

Question 54

Scenario 14-1
Selfridges is the second-largest department store in Great Britain. It works with House of Frasier, one of its competitors, to reduce operating costs by sharing channels of distribution to ship goods from more than 1,500 suppliers.
Refer to the scenario. What are Selfridges and House of Frasier engaged in?

A)vertical conflict
B)an integrated supply chain
C)a strategic channel alliance
D)an information-based distribution channel

Question 55

Apple sells its computers through both its own retail shops as well as through Staples. What kind of channel does Dell use?

A)multiple
B)intensive
C)contractual
D)cumulative

Question 56

What is the benefit of a nontraditional channel?

A)being the only business in the channel
B)being good for niche products
C)having another avenue for sales
D)having a multiple channel alliance

Question 57

Canesta Company has developed a virtual keyboard out of light to be used with cell phones and personal digital assistants (PDAs). The product beams an image of a keyboard on a desk, allowing the user to type on the image. The words are picked up by the user's digital device. If, in choosing its channel, Canesta is most concerned about supplying the number of consumers who have expressed interest in such a device, what will its choice of channels largely be influenced by?

A)exclusivity agreements
B)market factors
C)product factors
D)internal environmental agreements

Question 58

Canesta Company has developed a virtual keyboard out of light to be used with cell phones and personal digital assistants (PDAs). The product beams an image of a keyboard on a desk, allowing the user to type on the image. The words are picked up by the user's digital device. When introduced to the market, the device will sell for less than $50. If, in choosing its channel, Canesta is most concerned about the life cycle of the device, what will its choice of channels largely be influenced by?

A)factors of production
B)customer characteristics
C)product factors
D)market factors

Question 59

The Hudson Bay Company distributes furniture, television sets, silverware, clothing and more throughout Canada via its own stores and the Internet. Which type of distribution does The Bay use?

A)intensive
B)multiple
C)cumulative
D)aggregated

Question 60

A retailer channel is most common when the retailer is large and can buy in large quantities directly from the manufacturer.Which of the following does your textbook give as an example?

A)Ikea
BChapters Indigo
C)Amazon
D)Starbucks

Question 61

What is another name for a channel leader?

A)channel captain
B)channel facilitator
C)distribution supervisor
D)channel gatekeeper

Question 62

Luxury home furniture manufacturer Home-Living, is in the process of looking for a distribution channel for its new line of high-end sofas.Home Living is most concerned about protecting its prestige image and controlling the message communicated by salespeople. These factors affecting the choice of channel would fall under which of the following?

A)producer factors
B)customer factors
C)product factors
D)market factors

Question 63

Walker Zanger Inc. manufactures decorative tile. The company has a policy of only having one or two dealers within a given large geographic area. Buyers of Walker Zanger brand terra-cotta and mosaic tiles for home decorating will travel to acquire just the right product, so which type of distribution is appropriate for the tile?

A)exclusive
B)intensive
C)selective
D)premium

Question 64

Which of the following manufacturers most likely uses intensive distribution?

A)Cadbury Adams, manufacturer of Certs breath fresheners
B)Citizen, a manufacturer of digital scales
C)Champion, a manufacturer of inline skates
D)Cuisinart, a manufacturer of kitchen appliances

Question 65

Which of the following best describes channel conflict?

A)It always has an adverse effect on the members of the channel and consumers.
B)It can often lead to a clash of goals among distribution channel members.
C)It usually appears as internal.
D)It does not occur when multiple distribution channels are used.

Question 66

The LaCoste brand apparel was once available at Zellers and a number of other non-luxury retailers. Today the LaCoste brand can be found only at Holt Renfrew's and LaCoste boutiques. From this information, you can surmise that LaCoste has adopted which type of distribution strategy?

A)extensive
B)intensive
C)premium
D)selective

Question 67

Wrigley's chewing gum aims to achieve maximum market coverage. It wants its products to be available in every outlet where potential customers might want to buy them?

A)selective franchising
B)channel franchising
C)intensive distribution
D)exclusive distribution

Question 68

Husqvarna Viking manufactures sewing machines. The company carefully screens its dealers to ensure a quality dealer image and service ability. Only a few dealers are chosen in any single geographic area. Which type of distribution does Husqvarna Viking use?

A)intensive
B)exclusive
C)selective
D)mass

Question 69

DeBeers sells most of the diamonds it produces to industry. The company controls over 90 percent of the market and has great power over its distributors. In its marketing channel, what would DeBeers be considered?

A)a channel authority
B)a channel member
C)a channel leader
D)a channel gatekeeper

Question 70

R.H. Kurt & Son, Inc., distributes rifles for hunting and target shooting, rifle barrels, triggers, cleaning equipment, and reloading equipment to sporting equipment retailers and many large discount stores. It carries products from 41 different manufacturers. The manufacturers whose products it carries are known for producing superior products and are leaders in their industries. Given the nature of the products carried by Kurt, its 41 manufacturers most likely want Kurt to use which type of distribution?

A)expansive
B)intensive
C)reflexive
D)selective

Question 71

Luxury home furniture manufacturer Home Living is in the process of looking for a distribution channel for its new line of high-end sofas. Home Living is most concerned about protecting its prestige image and controlling the message communicated by salespeople. What level of distribution would you recommend?

A)exclusive
B)selective
C)dual
D)intensive

Question 72

There are less five Aston Martin luxury car dealerships in Canada. Aston Martin Canada uses which type of distribution strategy?

A)selective
B)intensive
C)exclusive
D)premium

Question 73

Canesta Company has developed a virtual keyboard out of light to be used with cell phones and personal digital assistants (PDAs). The product beams an image of a keyboard on a desk, allowing the user to type on the image. The words are picked up by the user's digital device. When introduced to the market, the device will sell for less than $50.If, in choosing its channel, Canesta is most concerned about its lack of financial, managerial, and marketing resources to support the product's introduction, what will its choice of channels largely be influenced by?

A)factors of ownership
B)market factors
C)producer factors
D)product factors

Question 74

Johns Manville is the only manufacturer to offer a complete line of formaldehyde-free fibreglass building insulation, which offers superior energy efficiency in hard-to-reach cathedral ceilings and flat roof cavities; it is also an excellent sound control for interior floors. As the only manufacturer and patent holder of this revolutionary insulation, Johns Manville has great power over its dealers. What is Johns Manville an example of?

A)a channel authority
B)a channel regulator
C)a channel captain
D)a channel gatekeeper

Question 75

Toothpaste is sold in grocery stores, service stations, convenience stores, drugstores, discount stores, and motel vending machines. What type of distribution strategy is used for toothpaste?

A)exclusive
B)selective
C)horizontal
D)intensive

Question 76

Shopping goods and some specialty products that consumers are willing to search for are sold through a type of distribution that is achieved by screening dealers to eliminate all but a few in any single geographic area. What is the type of distribution being used?

A)intensive
B)selective
C)exclusive
D)controlled

Question 77

Caterpillar, the manufacturer of tractors and other earthmoving equipment, has an extremely high market share, which means customers seek out the dealers, regardless of where they are. There are approximately eight Caterpillar dealers in all of Canada. From this information, which type of distribution does Caterpillar use?

A)selective
B)premium
C)intensive
D)exclusive

Question 78

After years of strong growth, Taco Bell is branching out from traditional single-purpose stores. Its uses kiosks, movable carts in malls and at the gas station, products on supermarket shelves, and even in-school lunch programs. In only a few years, it has more than quintupled its points of access. It aims to have 200,000 outlets; most of which will be nontraditional. What is Taco Bell potentially producing among its franchisees and other distributors of Taco Bell products?

A)vertical conflict
B)cognitive dissonance
C)supply management divergence
D)horizontal conflict

Question 79

Honda uses just-in-time manufacturing to build its Odyssey minivans. Five companies that make component parts for the Honda Odyssey relocated to Southern Ontario when Honda announced plans to build a new Odyssey manufacturing plant in Alliston, Ontario. This relocation in order to provide efficient delivery of goods indicates that Honda is which of the following?

A)a channel captain
B)a horizontal integrator
C)a distribution champion
D)a demand gatekeeper

Question 80

Daya Rai operates a Super Juice franchise. Super Juice states in its franchisee agreement that restaurants must be kept clean at all times, that customers must be served within 2 minutes of arriving, and that managers must know the names of return customers. If Daya is unable to meet these conditions, what could this cause?

A)channel disagreement
B)horizontal conflict
C)contract dissolution
D)vertical conflict