Question 1

Indian automobile manufacturer, Tata Motors is considering selling in Canada. Which one of the following would best determine the type of intermediary Tata use in Canada?

Accepted Answer

The type of intermediary Tata uses in Canada is likely to be determined by factors such as product characteristics (e.g. size, complexity, customization requirements), buyer considerations (e.g. purchase frequency, price sensitivity), and market characteristics (e.g. level of competition, customer preferences). Competitive conditions, economic characteristics, government regulations, product form, size, political considerations, product shape, manufacturing technology, and staff skills are all relevant factors to consider in the marketing mix, but are not as directly relevant to the choice of intermediary.

Question 2

The only way Jim Keeler in British Columbia can get a box of Carolyn Popwell's Festive Holiday Truffles from Washington is to order it through the mail from Popwell. What type of channel is this?

Accepted Answer

This is a direct channel, as the customer is ordering directly from the producer (Popwell), without any intermediaries involved.

Question 3

Which of the following activities is NOT a transactional channel function?

Accepted Answer

Physical distribution and sorting are logistical functions, not transactional channel functions. Transactional functions involve activities related to buying, selling, and risk-taking.

Question 4

Which of the following are examples of facilitating functions performed by wholesaling intermediaries?

Accepted Answer

Facilitating functions performed by wholesaling intermediaries include researching and financing, as these activities help in the smooth operation and efficiency of the distribution process.

Question 5

Which type of intermediaries are retailers and merchant wholesalers?

Accepted Answer

Retailers and merchant wholesalers are intermediaries that take title to a product, meaning they purchase goods from manufacturers and sell them to customers without changing the product significantly. They are different from agents or brokers who facilitate transactions without taking ownership of the goods.

Question 6

Which of the following logistical activities do marketing channels perform?

Accepted Answer

Marketing channels are responsible for the movement and transfer of goods from the manufacturer to the end consumer. This involves physically transporting goods from one place to another. Therefore, transporting is the most appropriate logistical activity that marketing channels perform. Promoting refers to creating awareness about goods and services, negotiating refers to the process of reaching an agreement, and risk-taking involves managing the potential risks and uncertainties associated with the distribution of goods, which are not necessarily logistical activities.

Question 7

What is the major characteristic used to differentiate between types of intermediary categories?

Accepted Answer

The major characteristic used to differentiate between types of intermediary categories is whether they take title to the products they sell. Intermediaries who take title to the products are known as merchants, while those who do not take title are known as agents. This is an important characteristic as it determines the degree of control the intermediary has over the product and the risks associated with being responsible for the product.

Question 8

Which channel is typically used between a supplier and manufacturer of industrial products?

Accepted Answer

Direct channel is typically used between a supplier and manufacturer of industrial products as they deal with large quantities and require specialized products. Direct channel helps in maintaining the quality of the products and reduces the cost of selling and distributing the products. Industrial merchants, wholesalers, and retailers are not typically involved in the supply chain between a supplier and manufacturer of industrial products.

Question 9

Although Acer Computers manufactures thousands of units per year, its wholesale customers are able to purchase smaller more manageable quantities. What is this called?

Accepted Answer

This is called allocating, which means dividing and distributing a larger quantity into smaller, more manageable portions.

Question 10

Long Island Lefty provides retailers and other businesses with the latest and the best products for left-handed consumers. It buys all types of products from a variety of manufacturers and stores the merchandise in its New York warehouse until purchased by buyers. Long Island Lefty does not sell to end users. What is Long Island Lefty an example of?

Accepted Answer

Long Island Lefty is a merchant wholesaler, as it purchases products from manufacturers and stores them in a warehouse until they are sold to retailers or other businesses. It does not sell directly to end users or consumers.

Question 11

Which of the following are wholesaling intermediaries that facilitate the sales of a product from producer to end user by representing retailers and manufacturers and sometimes wholesalers, without providing much input as to the terms of the sale?

Accepted Answer

Agents and brokers are intermediaries that facilitate the sales of a product from producer to end user by representing retailers and manufacturers, and sometimes wholesalers, without providing much input as to the terms of the sale. They earn a commission for their services, but do not take ownership of the products they sell. Marketing facilitators, channel cooperatives, and merchant wholesalers are all types of intermediaries that provide more extensive services and may take ownership of the products they sell.

Question 12

Which of the following is NOT a sorting activity?

Accepted Answer

"Possession" does not refer to the act of arranging or separating items in a specific order or manner, which is the essence of sorting activities. "Assorting" involves classifying items according to specific criteria, "accumulation" refers to gathering items together, and "allocation" involves distributing items to different groups or individuals.

Question 13

What are the three basic functions performed by channel intermediaries?

Accepted Answer

The three basic functions performed by channel intermediaries are transactional functions (buying, selling, and risk taking), logistical functions (transporting, storing, and sorting), and facilitating functions (financing, market research, and information dissemination). Choice A correctly identifies these functions. Choices B, C, and D do not accurately reflect the basic functions of channel intermediaries.

Question 14

W.W. Grainger Inc. is one of the world's largest business-to-business distributors of equipment, component parts, and supplies in the United States and Canada. It has ownership title to over 220,000 products, which are stocked in one national and nine regional warehouses to guarantee product availability and quick service to the many manufacturers that are its customers. What is W.W. Grainger an example of?

Accepted Answer

W.W. Grainger is a merchant wholesaler, as they purchase products from manufacturers and sell them to businesses (manufacturers) rather than directly to consumers.

Question 15

Dell computers sells to end-users. They use no other intermediary. What kind of channel do they use?

Accepted Answer

Dell computers use a direct channel as they sell directly to end-users without any intermediaries involved.

Question 16

Desk manufacturer Office-Pro wants to route its new line of desks from the company to the end-user. Which of the following would they typically NOT use?

Accepted Answer

The answer of Desk manufacturer Office-Pro wants to route its...

Question 17

EWEL buys goods from manufacturers, takes title to these goods, and resells them to businesses and retailers? What are they an example of?

Accepted Answer

EWEL is a merchant wholesaler as they take title to the goods and resell them to businesses and retailers.

Question 18

Surj has just inherited his small family farm. He is new to the business and knows little about finding customers for cattle as well as wheat grown on the farm. What channel type would you recommend he use?

Accepted Answer

Surj being new to the business and having little knowledge about finding customers, he may benefit from using agents or brokers who have existing relationships with potential buyers and can help him navigate the market. The other options, wholesale distributors, retail specialists, and national grocery chains, may not be suitable for the size of Surj's small family farm.

Question 19

Vicobello is a manufacturer of outdoor fountains that are currently popular in gardens. Even though fountains represent a product category that does not sell year-round due to inclement weather, Vicobello's sales remain steady all year because it sells to wholesale distributors that stock the product. Which type of function do the wholesale distributors perform for Vicobello?

Accepted Answer

Wholesale distributors perform logistical function since they stock the product and ensure it's available to retailers for sale all year round.

Question 20

Which of the following includes managing the movement of raw materials and parts from their sources to production sites; managing the movement of materials, semi-finished, and finished products within and among plants, warehouses, and distribution centres; and the planning and coordinating of the physical distribution of finished goods to intermediaries and final buyers?

Accepted Answer

Logistics includes managing the movement of raw materials, parts, and finished goods from their sources to their destinations, as well as the coordination of transportation and storage activities within and among facilities. Materials handling and intermodal transportation are subsets of logistics that focus on specific aspects of the movement of goods, while contract logistics refers to the outsourcing of logistics activities to third-party providers.

Quiz 14: Marketing Channels and Supply Chain Management