Question 1

_____ involve(s)a manufacturer purchasing wholesalers or retailers.

Accepted Answer

A manufacturer's purchasing wholesalers or retailers is called forward integration.

Question 2

A corporate vertical marketing system is exemplified by:

Accepted Answer

Corporate vertical marketing systems involve single ownership of two or more levels of a channel. A manufacturer's purchasing wholesalers or retailers is called forward integration.

Question 3

In which of the following types of contractual vertical marketing systems do a group of independent retailers unite and agree to pool buying and managerial resources to improve competitive position?

Accepted Answer

In a retail cooperative organization, a group of independent retailers unite and agree to pool buying and managerial resources to improve competitive position.

Question 4

Which of the following is true about a contractual vertical marketing system?

Accepted Answer

The most visible type of contractual vertical marketing systems involves a variety of franchise programs.

Question 5

Which of the following is true of wholesaler-sponsored voluntary chains?

Accepted Answer

Franchises involve a parent company and an independent firm entering into a contractual relationship to set up and operate a business in a particular way. In a retail cooperative organization, a group of independent retailers unite and agree to pool buying and managerial resources to improve competitive position. In a wholesaler-sponsored voluntary chain, a wholesaler contracts with a number of retailers and performs channel functions for them. In administered vertical marketing systems, there is a higher degree of interorganizational planning and management than in a conventional channel. The dependence in these systems can result from the existence of a strong channel leader such that other channel members work closely with this company in order to maintain a long-term relationship.

Question 6

An administered vertical marketing system is exemplified by:

Accepted Answer

The dependence in administered vertical marketing systems can result from the existence of a strong channel leader such that other channel members work closely with this company in order to maintain a long-term relationship. While any level of channel member may be the leader of an administered system, Walmart, Kmart, and Sears are excellent examples of retailers that have established administered systems with many of their suppliers.

Question 7

Which of the following is true of franchises?

Accepted Answer

Franchises involve a parent company and an independent firm entering into a contractual relationship to set up and operate a business in a particular way. In a retail cooperative organization, a group of independent retailers unite and agree to pool buying and managerial resources to improve competitive position. In a wholesaler-sponsored voluntary chain, a wholesaler contracts with a number of retailers and performs channel functions for them. In administered vertical marketing systems, there is a higher degree of interorganizational planning and management than in a conventional channel. The dependence in these systems can result from the existence of a strong channel leader such that other channel members work closely with this company in order to maintain a long-term relationship.

Question 8

Sears obtains over 50 percent of the goods it sells in its retail stores from companies that it partially or wholly owns.Sears participates in a _____ vertical marketing system.

Accepted Answer

Corporate vertical marketing systems involve single ownership of two or more levels of a channel. Firms may choose to develop corporate vertical marketing systems in order to compete more effectively with other marketing systems, to obtain scale economies, and to increase channel cooperation and avoid channel conflict.

Question 9

Which of the following is NOT a type of vertical marketing system?

Accepted Answer

The major types of vertical marketing systems include administered, contractual, and corporate systems.

Question 10

Which of the following is true about a corporate vertical marketing system?

Accepted Answer

Corporate vertical marketing systems involve single ownership of two or more levels of a channel.

Question 11

Channels in which members are more dependent on one another and develop long-term working relationships in order to improve the efficiency and effectiveness of the system are called _____ marketing systems.

Accepted Answer

Vertical marketing systems are channels in which members are more dependent on one another and develop long-term working relationships in order to improve the efficiency and effectiveness of the system.

Question 12

Which of the following is true of administered vertical marketing systems?

Accepted Answer

Franchises involve a parent company and an independent firm entering into a contractual relationship to set up and operate a business in a particular way. In a retail cooperative organization, a group of independent retailers unite and agree to pool buying and managerial resources to improve competitive position. In a wholesaler-sponsored voluntary chain, a wholesaler contracts with a number of retailers and performs channel functions for them. In administered vertical marketing systems, there is a higher degree of interorganizational planning and management than in a conventional channel. The dependence in these systems can result from the existence of a strong channel leader such that other channel members work closely with this company in order to maintain a long-term relationship.

Question 13

The retail cooperative organization,wholesaler-sponsored voluntary chain,and various franchising programs are the three major types of _____ vertical marketing systems.

Accepted Answer

Three major types of contractual vertical marketing systems are the retail cooperative organization, wholesaler-sponsored voluntary chain, and various franchising programs.

Question 14

Which of the following vertical marketing systems are most similar to conventional channels?

Accepted Answer

Administered vertical marketing systems are most similar to conventional channels.

Question 15

Coca-Cola licenses wholesalers in various markets that buy its syrup concentrate and then carbonate,bottle and sell Coke products to retailers in their local markets.Coca-Cola participates in a(n)_____ vertical marketing system.

Accepted Answer

Contractual vertical marketing systems involve independent production and distribution companies entering into formal contracts to perform designated marketing functions. Three major types of contractual vertical marketing systems are the retail cooperative organization, wholesaler-sponsored voluntary chain, and various franchising programs.

Question 16

Which of the following is true of retail cooperative organizations?

Accepted Answer

Franchises involve a parent company and an independent firm entering into a contractual relationship to set up and operate a business in a particular way. In a retail cooperative organization, a group of independent retailers unite and agree to pool buying and managerial resources to improve competitive position. In a wholesaler-sponsored voluntary chain, a wholesaler contracts with a number of retailers and performs channel functions for them. In administered vertical marketing systems, there is a higher degree of interorganizational planning and management than in a conventional channel. The dependence in these systems can result from the existence of a strong channel leader such that other channel members work closely with this company in order to maintain a long-term relationship.

Question 17

The dependence in administered vertical marketing systems can result from the existence of a strong:

Accepted Answer

The dependence in administered systems can result from the existence of a strong channel leader such that other channel members work closely to maintain a long-term relationship.

Question 18

_____ vertical marketing systems involve single ownership of two or more levels of a channel.

Accepted Answer