Question 1

In the U.S., many factories are concentrated in rural areas.

Accepted Answer

In the U.S., many factories are concentrated in urban or suburban areas due to better access to transportation, labor, and infrastructure, rather than in rural areas.

Question 2

Relationship-specific adaptations are usually not required when the buying organization uses outsourcing.

Accepted Answer

Relationship-specific adaptations may be required in outsourcing relationships as well. While outsourcing involves transferring some of the activities and responsibilities to an external vendor, it still requires coordination and communication between the buying organization and the vendor to ensure successful outcomes. Adaptations such as trust-building, communication protocols, and performance measurement systems may be necessary for effective outsourcing relationships.

Question 3

Firms that are described by NAICS code 3152 are more similar than firms described by NAICS code 31.

Accepted Answer

NAICS code 3152 specifically refers to clothing manufacturers, while NAICS code 31 is a broad category that includes manufacturing of various products such as food, furniture, and medical equipment. Therefore, firms within NAICS code 3152 are more similar because they are all involved in the same industry.

Question 4

Compared to final consumers, manufacturers tend to be more spread out geographically.

Accepted Answer

Manufacturers are often more concentrated geographically due to factors like the need for proximity to raw materials, transportation networks, and labor markets, whereas final consumers are spread out more widely to reflect the general population distribution.

Question 5

Specific adaptations are usually made when the buying organization chooses to outsource.

Accepted Answer

Specific adaptations are commonly made when a company decides to outsource so that the outsourcing arrangement meets the specific needs and requirements of the buying organization.

Question 6

In business markets, buyer-seller relationships tend to be an "all-or-nothing" arrangement--either very close or not at all close.

Accepted Answer

In business markets, buyer-seller relationships can vary widely, from very close, collaborative partnerships to purely transactional interactions, and everything in between.

Question 7

It is very common for manufacturers to concentrate in certain geographic areas and by type of industry.

Accepted Answer

This statement is true. Manufacturers often cluster together in certain geographic areas and specialize in specific types of industries. This can be beneficial for factors such as access to raw materials, skilled labor, and networking opportunities. Examples of well-known manufacturing clusters include Silicon Valley for electronics and technology, Detroit for automobiles, and the Rust Belt for steel and heavy machinery.

Question 8

In the market composed of service producers, most firms are small and geographically dispersed.

Accepted Answer

This is true, as the service sector consists of a large number of small and medium-sized enterprises (SMEs) that are often spread out across different regions.

Question 9

Negotiated contract buying means agreeing to contracts that allow for changes in the purchase arrangements.

Accepted Answer

Negotiated contract buying involves agreements that allow for modifications to be made to the terms of purchase.

Question 10

Just-in-time delivery reliably helps to get products and store them long before the customer needs them.

Accepted Answer

Just-in-time delivery involves delivering products to the customer just in time, as they are needed. It does not involve storing products long before the customer needs them.

Question 11

Relationship-specific adaptations involve changes in a firm's product or procedures that are unique to the needs or capabilities of a relationship partner.

Accepted Answer

Relationship-specific adaptations are tailored to meet the specific needs and requirements of a particular relationship partner and can include changes in a firm's product or procedures. This can include customization of products, changes in processes, or even the development of new technologies to meet the unique needs of a particular customer.

Question 12

Negotiated contract buying would be used when the buyer knows precisely what he wants and the requirements of the job aren't likely to change as the job is done.

Accepted Answer

Negotiated contract buying is often used when the requirements are not fully known at the outset, allowing for flexibility and adjustments as the project progresses.

Question 13

The U.S. government reports data on the number of firms, sales volume, and number of employees by NAICS code.

Accepted Answer

The U.S. government does report data on the number of firms, sales volume, and number of employees by NAICS (North American Industry Classification System) code.

Question 14

The U.S. government collects and publishes data by the NAICS codes.

Accepted Answer

The North American Industry Classification System (NAICS) is used by the U.S. government to collect and publish data on businesses and industries.

Question 15

Although we talk about close "relationships" between firms in business markets, in practice it is just the relationship between the salesperson and purchasing manager that becomes close.

Accepted Answer

While the relationship between a salesperson and a purchasing manager can be significant, business relationships in markets often extend beyond these two roles, involving deeper, strategic partnerships between firms that encompass various departments, levels of management, and functions beyond just sales and purchasing. These relationships can include collaboration on product development, supply chain management, and other areas of mutual interest.

Question 16

Most manufacturers are quite small, with 250 or fewer employees.

Accepted Answer

According to data from the National Association of Manufacturers, most manufacturers in the United States have 250 or fewer employees.

Question 17

In cooperative relationships in a business market, the buyer and seller work together to jointly achieve both mutual and individual objectives.

Accepted Answer

Cooperative relationships in a business market involve collaboration between the buyer and seller to achieve common objectives as well as their own individual goals.

Question 18

The term "NAICS" stands for New Auto Industry Classification Survey.

Accepted Answer

The term "NAICS" stands for North American Industry Classification System, which is used to classify businesses and industries in North America.

Question 19

Just-in-time relationships between buyers and sellers usually require operational linkages and information sharing.

Accepted Answer

Just-in-time relationships rely on frequent communication and collaboration between buyers and sellers in order to ensure that the right goods or services are delivered at the right time. This requires operational linkages, such as shared inventory management systems, and information sharing to coordinate production and delivery schedules.

Question 20

To protect themselves from unpredictable events, most purchasing managers seek several dependable sources of supply.

Accepted Answer

Purchasing managers seek dependable sources of supply as a way to mitigate risks associated with unpredictable events such as supply chain disruptions, natural disasters, and changes in market conditions. By having multiple sources, they can better ensure continuity of supply and reduce the likelihood of significant disruptions to their operations.

Quiz 7: Business and Organizational Customers and Their Buying Behavior