Question 1

_____ is a network of value chain organizations performing functions that connect goods and services with end-users.
A) Line extension
B) Retail chain
C) Channel of distribution
D) Digital channel

Accepted Answer

A channel of distribution is a network of organizations that work together to connect goods and services with end-users. This includes manufacturers, wholesalers, retailers, and other intermediaries who perform various functions like marketing, selling, and delivery. A line extension refers to adding new products to an existing product line, a retail chain refers to a series of retail stores owned by the same company, and a digital channel refers to selling products online.

Question 2

Agile supply chains require long-term partnership with suppliers.

Accepted Answer

False

Question 3

The conventional channel of distribution is a group of horizontally linked independent organizations.

Accepted Answer

The conventional channel of distribution involves a series of independent organizations that are vertically linked, each performing its function in the distribution process from producer to consumer.

Question 4

A primary feature of a vertical marketing system is the management (or coordination) of the distribution channel collectively by the organizations involved.

Accepted Answer

The answer of A primary feature of a vertical marketing...

Question 5

Which of the following value-added activities would most effectively reduce the number of transactions for producers and end-users?
A) Assembly of products into inventory
B) Servicing and repairs
C) Processing and storage of goods
D) Buying and selling activities by marketing intermediaries

Accepted Answer

Marketing intermediaries streamline the distribution process, reducing the number of transactions required between producers and end-users by buying in bulk from producers and selling in smaller quantities to consumers.

Question 6

Relationships between the conventional channel participants are rather informal and the members are not closely coordinated.

Accepted Answer

The statement accurately describes the nature of relationships between conventional channel participants.

Question 7

_____ is defined as the group of vertically aligned organizations that keep improving a product in moving from basic supplies to finished products for consumer and organizational end-users.
A) Value chain
B) Distribution strategy
C) Retail strategy
D) Digital channel

Accepted Answer

The definition provided in the question closely matches the concept of a value chain. Value chain encompasses all the activities involved in bringing a product to market and delivering it to customers. It includes suppliers, manufacturers, distributors, retailers, and ultimately, the end-users. The purpose of a value chain is to maximize value creation while minimizing costs.

Question 8

Buying and selling activities by marketing intermediaries reduce the number of transactions for producers and end-users.

Accepted Answer

Marketing intermediaries such as wholesalers and retailers consolidate the demand of multiple end-users and purchase in bulk from producers, reducing the number of transactions for both parties. Similarly, intermediaries also reduce the number of transactions for end-users by aggregating the supply from multiple producers and offering a diverse range of products in one place.

Question 9

Which of the following factors favors direct distribution by the manufacturer?
A) Simple product/application
B) Large number of geographically concentrated buyers
C) Opportunity for competitive advantage
D) Small and frequent purchases

Accepted Answer

The answer of Which of the following factors favors direct...

Question 10

A conventional distribution channel offers little opportunity for control by a member firm,yet there is a lot of flexibility in entering and exiting from the channel.

Accepted Answer

Conventional distribution channels are typically loose networks of independent businesses, allowing firms to easily join or leave without much control over the entire channel.

Question 11

Consumer-products manufacturers often direct advertising to _____to help pull products through distribution channels.
A) middlemen
B) consumers
C) distributors
D) retailers

Accepted Answer

Consumer-products manufacturers target advertisements towards consumers to create demand for their product, which in turn helps to pull the product through distribution channels.

Question 12

Large producers with extensive capabilities and resources have a lot of flexibility in choosing intermediaries.

Accepted Answer

Large producers have more options and resources to choose from when selecting intermediaries, giving them more flexibility in their decision-making.

Question 13

The _____ of distribution is a group of vertically linked independent organizations,each trying to look out for itself,with limited concern for the total performance of the channel. 
A) digital channel
B) vertical marketing system
C) direct channel
D) conventional channel

Accepted Answer

A conventional channel is characterized by independent organizations working for their own benefits, with limited concern for the overall performance of the channel. In contrast, a vertical marketing system (VMS) is a channel in which the members at different levels work together to achieve a common goal, while a direct channel is a channel in which a company sells directly to consumers without intermediaries. A digital channel refers to the use of online and digital platforms for selling and distributing products.

Question 14

Which of the following value-added activities helps to meet buyers' time-of-purchase and variety preferences?
A) Assembly of products into inventory
B) Transportation
C) Processing and storage of goods
D) Advertising and sales promotion

Accepted Answer

Assembly of products into inventory helps to meet buyers' time-of-purchase and variety preferences as it allows the company to have a ready-made inventory of various products. This makes it easier for buyers to find what they need and make purchases quickly, without having to wait for products to be assembled after the order is placed.

Question 15

Relationships between the conventional distribution channel participants are rather informal and the members are not closely coordinated.

Accepted Answer

Conventional distribution channels typically involve multiple intermediaries and the relationships between them are often informal and not highly coordinated.

Question 16

In a _____,one organization coordinates the distribution channel and directs programming of channel activities and functions.
A) vertical marketing system 
B) conventional channel
C) direct channel
D) digital channel

Accepted Answer

A vertical marketing system is a distribution channel where one organization coordinates and directs the channel activities and functions. This system involves the producer, wholesaler, and retailer working together to achieve greater efficiency and effectiveness in the distribution of products or services. Therefore, A) Vertical marketing system is the best choice for filling in the blank.

Question 17

If one retailer or dealer in the trading area distributes the product,then management is following a selective distribution strategy.

Accepted Answer

Selective distribution involves choosing a few retailers or dealers in a specific area to distribute a product, not just one. If only one retailer is used, it is considered exclusive distribution.

Question 18

_____ VMS exists because one of the channel members has the capacity to influence other channel members and exerts substantial control over them.
A) Ownership
B) Contractual
C) Administered
D) Relationship

Accepted Answer

Administered VMS, also known as managed or coordinated VMS, arises when one channel member wields significant power over the other members and can influence or control them. This type of VMS is not based on ownership or contract, but rather on the dominant member's ability to coordinate and direct the activities of the rest of the channel. Relationship VMS refers to alliances or partnerships between independent firms, while ownership and contractual VMS are based on owning or governing the entire distribution chain.

Question 19

A single product makes distribution by the manufacturer economically feasible,whereas the cost of direct sales for a complete line may be prohibitive.

Accepted Answer

A single product may not make distribution economically feasible due to high costs, whereas a complete line can spread costs over multiple products, making it more viable.

Question 20

_____ VMS includes various formal arrangements between channel participants including franchising and voluntary chains of independent retailers.
A) Ownership
B) Contractual
C) Administered
D) Relationship

Accepted Answer

Contractual VMS involves formal agreements between channel participants, such as franchising and voluntary chains. Ownership VMS refers to one member owning the other members in the channel, while administered VMS is when one member takes a leadership role in coordinating the channel without owning the others. Relationship VMS emphasizes building long-term relationships between channel members without formal contracts or ownership.

Quiz 10: Value Chain Strategy

_____ is a network of value chain organizations performing functions that connect goods and services with end-users.

Agile supply chains require long-term partnership with suppliers.

The conventional channel of distribution is a group of horizontally linked independent organizations.

A primary feature of a vertical marketing system is the management (or coordination) of the distribution channel collectively by the organizations involved.

Which of the following value-added activities would most effectively reduce the number of transactions for producers and end-users?

Relationships between the conventional channel participants are rather informal and the members are not closely coordinated.

_____ is defined as the group of vertically aligned organizations that keep improving a product in moving from basic supplies to finished products for consumer and organizational end-users.

Buying and selling activities by marketing intermediaries reduce the number of transactions for producers and end-users.

Which of the following factors favors direct distribution by the manufacturer?

A conventional distribution channel offers little opportunity for control by a member firm,yet there is a lot of flexibility in entering and exiting from the channel.

Consumer-products manufacturers often direct advertising to _____to help pull products through distribution channels.

Large producers with extensive capabilities and resources have a lot of flexibility in choosing intermediaries.

The _____ of distribution is a group of vertically linked independent organizations,each trying to look out for itself,with limited concern for the total performance of the channel.

Which of the following value-added activities helps to meet buyers' time-of-purchase and variety preferences?

Relationships between the conventional distribution channel participants are rather informal and the members are not closely coordinated.

In a _____,one organization coordinates the distribution channel and directs programming of channel activities and functions.

If one retailer or dealer in the trading area distributes the product,then management is following a selective distribution strategy.

_____ VMS exists because one of the channel members has the capacity to influence other channel members and exerts substantial control over them.

A single product makes distribution by the manufacturer economically feasible,whereas the cost of direct sales for a complete line may be prohibitive.

_____ VMS includes various formal arrangements between channel participants including franchising and voluntary chains of independent retailers.