Question 1

_____ retailers differentiate themselves with unique assortments,quality merchandise,good customer service,and a prestigious store image.

Accepted Answer

High-margin retailers differentiate themselves through factors that justify their higher prices, such as unique product offerings, higher quality merchandise, and a more luxurious store image. They can afford to invest more in customer service, which can further enhance their reputation and differentiate them from competitors. In contrast, low-margin and low-cost retailers rely on volume and low prices to attract customers, and may not have the resources to invest in the same level of differentiation. High-turnover retailers may have a focus on fast-moving products, but this alone may not be enough to differentiate them from other retailers.

Question 2

Which of the following is the easiest way to enter a foreign market?

Accepted Answer

Exporting is the easiest way to enter a foreign market as it involves selling goods or services produced in the home country in the foreign market without setting up any operations or investment in the foreign market. It requires the least investment and involves minimal risk.

Question 3

The primary advantage of an intensive distribution strategy is that:

Accepted Answer

The primary advantage of an intensive distribution strategy is that it maximizes product availability by using a large number of retailers or channel members. This ensures that customers have access to the product in a variety of locations, increasing the chances of a sale. However, retailer support and choosing target markets may not necessarily be improved with an intensive distribution strategy.

Question 4

Which of the following channels is most common for low cost,frequently purchased items?

Accepted Answer

The producer-wholesaler-retailer-consumer channel is most common for low-cost, frequently purchased items because it allows for efficient distribution and economies of scale, making it cost-effective for both producers and consumers.

Question 5

Which of the following is true of high-margin/low-turnover stores?

Accepted Answer

High-margin/low-turnover stores focus on offering expensive, prestigious national brands or exclusive goods that are not commonly available elsewhere. This is because these stores can afford to operate with lower sales volume due to their higher profit margins. They do not typically offer a wide variety of items or carry fast-moving products that would attract bargain shoppers. Additionally, they may have higher personnel costs due to the need for in-store sales assistance in order to properly sell the high-end merchandise.

Question 6

Splurge Inc. ,sells exquisite perfumes,bags,and designer wear.It is associated with high quality,prestige,and excellent customer service.Which of the following forms of distribution would be most appropriate for Splurge Inc.?

Accepted Answer

Exclusive distribution would be the most appropriate form of distribution for Splurge Inc. as their products are associated with high quality and prestige. This form of distribution limits the number of outlets selling the products, making them exclusive and catering to a particular target audience.

Question 7

Which of the following grants the right to use the company's name,trademarks,and technology?

Accepted Answer

Franchising grants the right to use a company's name, trademarks, and technology in exchange for fees and royalties.

Question 8

In _____,a firm offers the right to use its intangible assets in exchange for royalties or some other form of payment.

Accepted Answer

Licensing involves offering the right to use intangible assets such as patents, trademarks, or copyrights in exchange for payment in the form of royalties or fees. Exporting refers to selling goods or services to customers in another country, while contract manufacturing involves outsourcing production to a third-party manufacturer. Coproduction refers to the joint production of goods or services by two or more firms.

Question 9

Harper Inc.manufactures microwave ovens,washing machines,iron boxes,and coffee makers.Which of the following strategies would be most appropriate for the distribution of their products?

Accepted Answer

Harper Inc. manufactures multiple products that cater to different consumer needs. Selective distribution would be the most appropriate strategy as it involves selling products through a limited number of channels that align with the brand's image and target market. This would allow Harper Inc. to have better control over the distribution process and ensure their products are available in the locations where their target customers are most likely to purchase them. It also allows for a more personalized approach to marketing and customer service, which is important for high-involvement products such as microwave ovens, washing machines, iron boxes, and coffee makers.

Question 10

Which of the following is a popular channel,particularly for products targeted at two-wage-earner households?

Accepted Answer

The answer of Which of the following is a popular...

Question 11

Moon Art Inc. ,a publisher of graphic novels,comics,and humor books,uses mobile messages to promote its books to consumers.Which of the following retailing channel is Moon Art Inc.employing here?

Accepted Answer

Direct selling involves a direct communication or distribution method from the producer or seller to the consumer without intermediaries, which in this case is achieved through mobile messages promoting their products directly to consumers.

Question 12

Which of the following strategies uses the maximum possible number of retailers and is most appropriate for low-involvement,frequently purchased convenience goods?

Accepted Answer

Intensive distribution strategy uses the maximum possible number of retailers to make the product easily accessible to the customers. This strategy is most appropriate for low-involvement, frequently purchased convenience goods as customers prefer to shop for these products frequently and prefer them to be easily available. Hence, intensive distribution would be the best choice here.

Question 13

Which of the following statements is true of promotional effort and market information?

Accepted Answer

Company-owned channels like salesforce, warehouses, retail outlets, or websites are under the direct control of the firm, making it easier to control promotional efforts and market information. Independent middlemen and their behaviors are challenging to control, and finding acceptable replacements for poor performers can be time-consuming and costly. Indirect and horizontally integrated channels may help achieve high levels of promotional effort, but they still cannot be easily controlled by the firm.

Question 14

Which of the following is an example of nonstore retailing?

Accepted Answer

Nonstore retailing refers to the selling of products without a physical storefront or location. Lands' End is an example of nonstore retailing as it primarily sells its products through its website and catalog, without operating traditional brick-and-mortar stores. Costco, Walmart, and Ikea all have physical stores, making them examples of store retailing.

Question 15

_____ stores usually concentrate on fast-moving items and carry a relatively limited selection in each product category.

Accepted Answer

High-turnover stores usually focus on products that have high demand and are quickly sold to customers. This allows them to maintain a fast stock turnover rate and ensure that their inventory remains fresh. As a result, they usually carry a limited selection of products within each category, but this also enables them to stock a wider variety of products overall.

Question 16

The theory of transaction cost analysis (TCA)argues that when substantial transaction specific assets are involved:

Accepted Answer

The theory of transaction cost analysis (TCA) argues that when substantial transaction specific assets are involved, such as investments in marketing or training a distribution partner, the cost of using independent channel members is typically higher than the cost of managing a company salesforce. This is because the company can have more control over its salesforce and its activities, whereas independent channel members may require more management and coordination to align with the company's goals and standards.

Question 17

Which of the following is true of low-margin/high-turnover stores?

Accepted Answer

Low-margin/high-turnover stores typically focus on standardized, prepackaged merchandise. This allows them to keep their costs low and sell their products at a high volume to compensate for the low margin. They often carry basic or common items that customers need frequently, such as groceries or household goods.

Question 18

Which of the following channels is used when the manufacturer is too small,or its product line too narrow?

Accepted Answer

When a manufacturer is too small or its product line is too narrow, they often use a longer distribution channel like Producer-agent-wholesaler-retailer-consumer to reach a wider market without having to invest heavily in distribution infrastructure.

Question 19

The major disadvantage of using an exclusive distribution strategy from the viewpoint of the manufacturer is the:

Accepted Answer

Using an exclusive distribution strategy involves relying on a single retailer to distribute the product, which increases the risk for the manufacturer. If the retailer fails, the manufacturer's product may not reach the intended target audience, resulting in lost sales and revenue.

Question 20

Which of the following has limited retail coverage and is an appropriate strategy for shopping goods?

Accepted Answer

Selective distribution is the strategy where the manufacturer selects a limited number of retailers to distribute their products. This is an appropriate strategy for shopping goods that require more effort in selling and providing information to customers. It allows for better control over the distribution and ensures that the product is sold in the right environment. Intensive distribution is not appropriate as it aims to make the product available in as many retail outlets as possible. Exclusive distribution is not appropriate as it only allows one retailer to distribute the product. High-involvement product distribution is not a recognized strategy.

Quiz 12: Distribution Channel Decisions