Question 1

An intermediary who ________ legally owns the goods being handled.

Accepted Answer

The term "takes title" means that the intermediary legally owns the goods being handled. This is a common practice in distribution and supply chain management, where intermediaries will purchase goods from manufacturers in bulk and then resell them to retailers or customers. By taking title to the goods, the intermediary assumes the financial risk of buying and selling the products.

Question 2

At minimum, a channel of distribution consists of a producer and a(n) ________.

Accepted Answer

At minimum, a channel of distribution consists of a producer and a customer. The producer creates or provides the goods or services, and the customer is the end user who purchases or consumes them. This basic relationship forms the core of any distribution channel, regardless of the presence of any intermediaries like wholesalers, brokers, or diverters.

Question 3

Truck jobbers are limited-service merchant wholesalers who would most likely handle which of the following?

Accepted Answer

Truck jobbers typically handle perishable goods like fruits and vegetables, which require frequent delivery and quick turnover.

Question 4

Channel members can help producers by identifying customer complaints, customer preferences, and new competitors in the market. These are all examples of the ________ function of channel intermediaries.

Accepted Answer

Communication is the function of channel members that involves relaying information between the producer and the end customer. In this case, channel members are helping producers by communicating customer complaints, preferences, and new competitors in the market. This feedback helps producers to improve their products and stay ahead of competitors.

Question 5

Wholesalers and retailers create efficiencies in the flow of goods from producer to end consumer by ________ when they provide a variety of products in one location.

Accepted Answer

Wholesalers and retailers create efficiencies by creating assortments, which means they gather a variety of products in one location, making it easier for consumers to find and purchase different items without having to visit multiple producers.

Question 6

Drop shippers do all of the following EXCEPT which of the following?

Accepted Answer

Drop shippers do not take actual possession of the merchandise, instead they arrange for shipments directly from manufacturers or wholesalers to the retailers or industry buyers. They take orders, bill the retailers or industry buyers, and assume some risks, but they do not take title or physical possession of the merchandise.

Question 7

Through a process of ________, traditional intermediaries are being eliminated as many companies question the value added by layers in the distribution channel.

Accepted Answer

Disintermediation refers to the process of eliminating intermediaries in the distribution channel. Many companies are questioning whether these intermediaries add value and are looking for ways to sell directly to consumers. As a result, traditional intermediaries such as wholesalers and retailers are being cut out of the process.

Question 8

The owner of a grocery store wants to have non-food items delivered, priced, displayed, and inventoried by a wholesaler. Which type of wholesaler best fits the owner's needs?

Accepted Answer

A rack jobber is a type of wholesaler that provides delivery, pricing, display, and inventory management services to retailers, particularly for non-food items such as housewares, toys, and personal care products. The rack jobber places their own rack or display case in the retailer's store and keeps it stocked, while the retailer earns a commission on the sales. This would be the best fit for the grocery store owner who wants non-food items delivered and managed by a wholesaler.

Question 9

It is most accurate to say that channels of distribution provide which of the following?

Accepted Answer

Channels of distribution primarily provide time, place, and possession utility, facilitating the availability of products when and where consumers want them and making it easier for consumers to take possession or ownership of the goods.

Question 10

Which of the following is the series of firms or individuals that facilitate(s) the movement of a product from the producer to the final customers?

Accepted Answer

The channel of distribution refers to the series of firms or individuals involved in the movement of a product from the producer to the final customers.

Question 11

The theft and unauthorized repurposing of intellectual material via the Internet is called ________.

Accepted Answer

The term for the theft and unauthorized repurposing of intellectual material via the Internet is online distribution piracy. Subscription boxing, product diversion, disintermediation, and taking title are all different concepts and do not accurately describe this type of activity.

Question 12

Offering credit to buyers and providing refund services for products are both examples of ________ functions provided by channel intermediaries.

Accepted Answer

Facilitating functions include activities like offering credit to buyers and providing refund services for products, which help to make transactions between buyers and sellers easier and more efficient.

Question 13

Which of the following is the term for the firms and individuals who help move a product to the consumer or the business user?

Accepted Answer

Channel intermediaries are the firms and individuals who help move a product to the consumer or the business user. Product managers are responsible for developing and marketing a product. Channel leaders may refer to managers within the channel intermediaries or the company's own sales team. Enterprise resource planners are software systems used for managing resources within an organization. Franchisees are individuals or firms who operate under the brand and business model of a larger company.

Question 14

Which group of independent intermediaries can be divided into the two broad types of full-service and limited-service?

Accepted Answer

Merchant wholesalers can be divided into full-service wholesalers, who provide a wide range of services, and limited-service wholesalers, who offer fewer services.

Question 15

Intermediaries that do business with many different manufacturers and many different customers are most accurately referred to as ________.

Accepted Answer

Independent intermediaries work with multiple manufacturers and customers without a particular dependency on any one party.

Question 16

Which of the following describes a comprehensive approach to collecting, organizing, storing, and retrieving a firm's information assets?

Accepted Answer

Knowledge management is a comprehensive approach to collecting, organizing, storing, and retrieving a firm's information assets. It involves using technology, processes, and organizational culture to capture and share knowledge within an organization.

Question 17

Mail-order wholesalers are associated with all of the following EXCEPT which one?

Accepted Answer

Mail-order wholesalers typically require payment before shipment. They are associated with selling products to small retailers and other industrial customers, selling products to retailers in remote locations, carrying products in inventory, and selling through catalogs.

Question 18

Limited-service merchant wholesalers are less likely than full-service merchant wholesalers to do which of the following?

Accepted Answer

Limited-service merchant wholesalers typically do not offer marketing assistance or delivery services for the products they sell, unlike full-service merchant wholesalers who provide such services.

Question 19

A retailer that takes a loss on perishable items that do not sell before their expiration date is an example of the ________ function provided by channel intermediaries.

Accepted Answer

The retailer taking a loss on perishable items that do not sell before their expiration date is an example of the risk-taking function provided by channel intermediaries. The retailer bears the risk of buying and stocking perishable items, which have a limited lifespan, and may end up selling at a loss if they do not sell before the expiration date.

Question 20

Wholesalers and retailers purchase large quantities of goods from manufacturers but sell only one or a few at a time to many different customers. This process is called ________.

Accepted Answer

Breaking bulk refers to the process of purchasing large quantities of goods from manufacturers and then selling them in smaller quantities to individual customers. Wholesalers and retailers are involved in breaking bulk. The other options mentioned in the question (creating assortments, third-party logistics, order processing, and inventory control) are all related to various aspects of logistics and supply chain management, but they are not directly related to the process of breaking bulk.

Quiz 11: Deliver the Goods: Determine the Distribution Strategy