Question 1

Integrated channel relationships tend to be more flexible than cooperative relationships.

Accepted Answer

Cooperative relationships tend to be more flexible than integrated relationships but are more structured than arm's-length relationships.

Question 2

A marketing channel is a set of interdependent organizations that ease the transfer of ownership as products move from producer to business user or consumer.

Accepted Answer

A marketing channel is indeed a set of interdependent organizations that facilitate the transfer of ownership as products move from the producer to the end user or consumer.

Question 3

Tammy Bowles makes handmade,wooden children's toys,which she sells online to end users.Tammy does not use channel intermediaries,which means she uses a direct channel.

Accepted Answer

Tammy sells her products directly to the end users through online sales, without the involvement of any channel intermediaries such as wholesalers, retailers or distributors. This indicates that she uses a direct channel.

Question 4

As products move through the marketing channel,channel members provide specialization and division of labor,overcome discrepancies,and provide contact efficiency.

Accepted Answer

This statement is true. Channel members, such as distributors, wholesalers, and retailers, play a crucial role in the distribution and promotion of products. They provide specialization in certain areas of the supply chain, work to overcome discrepancies or differences in preferences between producers and consumers, and provide contact efficiency by being closer to the end consumer.

Question 5

Reciprocal conflict occurs among channel members on the same level,such as two or more different wholesalers or two or more different retailers that handle the same manufacturer's brands.

Accepted Answer

This is referred to as horizontal conflict.

Question 6

The Beistle Company manufactures Halloween decorations year-round,but customer demand is concentrated only during the month of October.By maintaining inventories of the Beistle Company's products,marketing channels overcome this spatial discrepancy.

Accepted Answer

This is an example of overcoming a temporal discrepancy.

Question 7

Highly integrated channel relationships are the preferred relationship because there is no large outlay of assets required to keep the channel members all working toward the same results.

Accepted Answer

Highly integrated channel relationships require significant costs and/or risks.

Question 8

An international consumer products manufacturer requires all of its suppliers to provide the lowest possible cost and to adhere to a just-in-time inventory system.Wholesalers and manufacturers generally yield to the authority of this large manufacturer.This consumer products manufacturer exercises channel power.

Accepted Answer

The manufacturer's requirement for the lowest possible cost and just-in-time inventory system gives it significant leverage over its suppliers, which is an example of channel power. The fact that wholesalers and manufacturers yield to the authority of the manufacturer further confirms that it exercises channel power.

Question 9

Carl represents a manufacturer of floor coverings and gets paid a commission for finding buyers and linking them up with the manufacturer.Carl is an example of a merchant wholesaler.

Accepted Answer

This defines an agent or broker.

Question 10

LoneStar Bar & Grill is a small chain of restaurants that feature marinated steaks.The marinade is so popular that LoneStar sells it at its restaurants and Kroger supermarkets.This is an example of intensive distribution.

Accepted Answer

This is an example of dual distribution (multiple distribution),which occurs when a producer selects two (or more)channels to distribute the same product to target markets.To be intensive distribution,LoneStar would have to offer the product through discount stores,drugstores,supermarkets,and so on.

Question 11

A consumer stopped by the convenience store to buy a bag of charcoal briquettes.She only needs one bag,but the manufacturer produces millions of bags.For consumers,the convenience store overcomes a discrepancy of dimensions.

Accepted Answer

The store overcomes the discrepancy of quantity.

Question 12

The three basic functions a channel intermediary provides are transactional,logistical,and facilitating functions.

Accepted Answer

A channel intermediary provides transactional functions such as negotiation, selling, and risk taking; logistical functions such as storage, transportation, and sorting; and facilitating functions such as financing, market research, and promotion.

Question 13

Shopping goods are usually distributed selectively.Consumers are willing to look around for them but may not be willing to search or travel extensively to acquire the product.

Accepted Answer

Shopping goods are usually distributed selectively, meaning they are not available at every store or location. However, consumers are still willing to put in some effort to find them, but may not go to great lengths to do so.

Question 14

A merchant wholesaler is an institution that buys goods from manufacturers and resells them to businesses,government agencies,and other wholesalers or retailers.

Accepted Answer

A merchant wholesaler does indeed buy goods from manufacturers and resell them to businesses, government agencies, and other wholesalers or retailers.

Question 15

At one end of the channel relationship continuum is the "Arm's-length" relationship.

Accepted Answer

Arm's-length relationship refers to a distant and transactional relationship between channel partners. It is characterized by low levels of cooperation, communication, and trust.

Question 16

Consider a scenario in which there are five manufacturers,no intermediaries,and four consumers.Twenty transactions would be required for each consumer to receive products from each manufacturer.The introduction of one intermediary reduces the required number of transactions to four and demonstrates the idea of contact efficiency.

Accepted Answer

Introducing one intermediary reduces the required number of transactions to nine.

Question 17

Exclusive distribution increases direct competition among retailers.

Accepted Answer

An exclusive distribution arrangement shields a dealer from direct competition and enables it to be the main beneficiary of the manufacturer's promotion efforts in that geographic area.

Question 18

Metallurgical Designs makes gold and silver charms for necklaces and bracelets.It markets its charms to a few retailers in any one region and promotes them intensively to those retailers.This is an example of intensive distribution.

Accepted Answer

Intensive distribution means the product is available in every outlet the potential customer might want to buy it,not to just a few retailers.

Question 19

Transactional functions include contacting potential customers and assuming the risk of owning inventory.

Accepted Answer

Transactional functions are the activities that involve carrying out the transaction between the buyer and the seller. The two common examples of transactional functions are contacting potential customers (to create demand) and owning inventory (to meet the demand). Both these activities involve assuming a certain level of risk and are crucial for the smooth functioning of the business. Therefore, Option A is correct.

Question 20

The direct channel is used more often in consumer markets than in business-to-business markets.

Accepted Answer

The direct channel is used more often in business-to-business markets than in consumer markets.

Quiz 13: Marketing Channels