Question 1

Physical distribution,or logistics,is the integrated process of moving input materials to the producer,in-process inventory through the firm,and finished goods out of the firm through the channel of distribution.

Accepted Answer

Physical distribution, or logistics, is the integrated process of moving input materials to the producer, in-process inventory through the firm, and finished goods out of the firm through the channel of distribution.

Question 2

Receiving and properly processing customer orders is a critical step in getting product moving through the supply chain.

Accepted Answer

Receiving and properly processing customer orders is a critical step in getting product moving through the supply chain. It is also a point at which mistakes can easily occur, and when a mistake occurs in the order it usually carries through the whole fulfillment system.

Question 3

The degree of push versus pull used is fundamental in framing the channel structure and relationships that are likely to optimize a product's success.

Accepted Answer

The third aspect of channel decisions by marketing managers relates to what channel functions are most important to the success of the particular products. In large measure, this decision is framed by whether the general approach is a push strategy or a pull strategy.

Question 4

Often,channel members adopt an approach of utilizing their unique competencies to influence others in the channel.

Accepted Answer

Often, channel members adopt an approach of utilizing their unique competencies to influence others in the channel.

Question 5

Exclusive dealing may be legal if the parties show exclusivity is essential for strategic reasons,such as to maintain product image.

Accepted Answer

Exclusive dealing may be legal if the parties show exclusivity is essential for strategic reasons, such as to maintain product image. High-fashion brands often engage in exclusive dealing with retailers so that their image is not sullied by being merchandised in the store next to step-down labels.

Question 6

In reality,cutting out intermediaries is always a guarantee of saving consumers money.

Accepted Answer

Cutting out intermediaries is not a guarantee of saving consumers money. In the long run, channel intermediaries tend to continue to participate in a channel only as long as their value added to the channel supports their inclusion. If an intermediary of any of the types shown in Exhibit 11.3 doesn't carry its weight, the channel structure eventually will change accordingly to maximize efficiencies across the utilities. Thus, channel members add their value by bridging gaps in form, time, place, and ownership that naturally exist between producers and consumers.

Question 7

Within a particular product category,the variety and assortment of products carried by retailers tends to be very similar.

Accepted Answer

QVC expands the assortment available to its customers by offering a wider variety of products on its website.

Question 8

While popular with consumers,vending machines are not particularly profitable.

Accepted Answer

Although popular with consumers, vending machines are not necessarily the most popular form of non-store retailing. Rising costs in labor, gasoline, and maintenance, coupled with a very competitive environment that limits price increases, keeps margins low.

Question 9

Channel intermediaries enhance utilities by providing a wide array of specific functions.

Accepted Answer

Channel intermediaries enhance utilities by providing a wide array of specific functions. Their contributions can be classified into physical distribution functions, transaction and communication functions, and facilitating functions.

Question 10

The primary advantage of the television home shopping retail format is the ability to show and demonstrate the product.

Accepted Answer

Dermot Boyd, CEO of QVC UK, said: "Mobile is the fastest growing platform and that includes tablets. But TV viewing has gone up too. The important thing is we can be on both screens: TV and tablets. Tablets and mobiles reinforce the TV platform, and we are streaming on the web too. Often, when people see something on QVC, it drives in-store sales of that product as well. And, through our website, QVC also allows brands to expand. At the end of the day, we're a retailer too."

Question 11

A producer can always grant an intermediary an exclusive territory for sales purposes.

Accepted Answer

An exclusive territory protects an intermediary from having to compete with others selling a producer's goods. Can a producer always grant an intermediary an exclusive territory for sales purposes? Not necessarily. For this practice to be legal, it would have to be demonstrated that the exclusivity doesn't violate any statutes on restriction of competition.

Question 12

In evaluating a website,one of the key measures is its "stickiness," which refers to the length of time visitors remain at the site.

Accepted Answer

In evaluating a website, one of the key measures is its "stickiness," which refers to the amount of time visitors remain at the site. A good website not only attracts a lot of visitors, but it also gets them to remain and explore the site.

Question 13

Despite profound changes,retail remains a small,insignificant part of the supply chain and consumer marketing.

Accepted Answer

An efficient, effective supply chain moves materials from manufacturer to consumer. Retailers are one form of intermediary in a channel. Retailing, in whatever form, is the point of contact in the supply chain with the consumer of the product. Put another way, retailing in its various forms represents a very important point of customer interface.

Question 14

In an ideal supply chain,materials of all kinds are handled as many times as possible.

Accepted Answer

In an ideal supply chain, materials of all kinds are handled as few times as possible. Any warehouse needs to be designed so that after goods are received and checked in, they move directly to their designated storage locations. Efficient, orderly, clean, and well-marked warehouses enhance the flow of goods.

Question 15

Many organizations are beginning to consider their customers-both end users and within a channel-as less important members of a value network.

Accepted Answer

Many organizations are beginning to consider their customers-both end users and within a channel-as important members of a value network.

Question 16

A channel is a system of interdependent relationships among a set of organizations that facilitates the exchange process.

Accepted Answer

A channel of distribution consists of interdependent entities that are aligned for the purpose of transferring possession of a product from producer to consumer or business user. Put another way, a channel is a system of interdependent relationships among a set of organizations that facilitates the exchange process.

Question 17

Unresolved channel conflict will never result in an uncooperative and inefficient channel,but it may impact end-user consumers through inferior products,spotty inventory,and higher prices.

Accepted Answer

Ultimately, channel conflict can occur in which channel members experience disagreements and their relationship can become strained or fall apart. Unresolved channel conflict can result not only in an uncooperative and inefficient channel, but it can also ultimately impact end-user consumers through inferior products, spotty inventory, and higher prices.

Question 18

The value chain portrays a mixture of primary and support activities utilized by an organization to design,produce,market,deliver,and support its products.

Accepted Answer

The value chain portrays a synthesis of primary and support activities utilized by an organization to design, produce, market, deliver, and support its products .

Question 19

A push strategy doesn't mean a manufacturer would refrain from engaging in any channel incentives,but rather that the incentives would likely be greatly reduced versus a pull strategy.

Accepted Answer

A push strategy means that much of the intensive promotional activities take place from the manufacturer downward through the channel of distribution. Think of this approach as an investment by the manufacturer in intermediaries so that they will have a maximal incentive to stock, promote, sell, and ship the firm's products. Push strategies usually are supported by heavy allowance payments to intermediaries for helping accomplish the manufacturer's goals.

Question 20

When marketing planning,a good channel decision is the most important within the entire planning process because it does leads to market advantage over competitors.

Accepted Answer

When marketing planning, a good channel decision can be one of the most important within the entire planning process and can lead to market advantage over competitors. Among the issues for consideration are:
What is the level of distribution intensity sought within the channel?
How much control and adaptability is required over the channel and its activities?
What are the priority channel functions that require investment?

Quiz 11: Manage Marketing Channels and Points of Customer Interface