Question 1

There are five major modes of transportation that can be used by companies. These are rail, road, air, water and _______.

Accepted Answer

Pipeline is the correct answer because rail, road, air, and water are already mentioned, and pipeline is another major mode of transportation used for transporting goods, especially liquids and gases. Sea, truck, and train are essentially subsets of water, road, and rail transportation, respectively.

Question 2

Methods of improving customer service standards include improving product availability, improving order _______ time, raising information levels and improving flexibility.

Accepted Answer

Cycle time refers to the time it takes to complete a process, such as fulfilling an order. Improving cycle time can lead to faster processing and delivery of orders, which can improve customer satisfaction. The other options (booking, receipt, tracking) are not relevant to improving customer service standards in the same way.

Question 3

In pure online retailing, the product is normally ordered online and then distributed either through the postal system or through the use of local distribution companies.

Accepted Answer

The answer of In pure online retailing, the product is...

Question 4

Physical distribution decisions focus on the efficient movement of goods from producer to _______ to the consumer.

Accepted Answer

Physical distribution decisions focus on the efficient movement of goods from producer to intermediaries to the consumer. Intermediaries play a crucial role in the physical distribution process, and managing their activities efficiently can help companies streamline the supply chain and improve customer satisfaction. Interdependents, interfirms, and interns are not relevant to physical distribution decisions.

Question 5

Trade-offs are often necessary when managing physical distribution. For example, low inventory and slow, cheaper transportation methods lower costs, but _______ customer service levels and satisfaction.

Accepted Answer

Low inventory and slow transportation methods may reduce costs but will lower customer service levels and satisfaction.

Question 6

Differentiation of a retail store provides _______.

Accepted Answer

Differentiation of a retail store provides a reason to shop at one store rather than another by offering unique products, services, or experiences that set it apart from competitors.

Question 7

There is concern that the _______ of supermarkets may squeeze out local suppliers as they are unable to compete with large supermarkets, resulting in a loss of employment and economic activity in these local communities.

Accepted Answer

The term "power" in this context refers to the market dominance that large supermarkets have, which allows them to negotiate lower prices from suppliers and offer lower prices to customers. This can make it difficult for small, local suppliers to compete and may lead to a loss of employment and economic activity in the community.

Question 8

Physical distribution management concerns the balance between cost reduction and meeting _______ service requirements.

Accepted Answer

Physical distribution management is all about efficiently delivering products to customers. Therefore, in this case, meeting customer service requirements is the most important factor to consider. While competitor, company, and supplier are also important, they are not directly related to the physical distribution management balancing act between cost reduction and customer service.

Question 9

Physical distribution cost savings can be achieved through _______.

Accepted Answer

All of the above options can lead to cost savings in physical distribution. By reducing inventory levels, a company can save on storage and handling costs. Using cheaper forms of transportation, such as truck instead of air, can reduce transportation costs. Shipping in bulk rather than smaller quantities can also save on transportation costs, as well as reduce the time and cost associated with loading and unloading goods. Therefore, choosing all of the above options can lead to maximum physical distribution cost savings.

Question 10

_______ (EDI) can speed up order processing time by checking the customer's credit rating and whether goods are in stock, issuing an order to the warehouse, invoicing the customer and updating the inventory records.

Accepted Answer

Electronic Data Interchange (EDI) is a system that allows for the electronic exchange of business documents between trading partners. It can speed up order processing time by automating tasks such as checking the customer's credit rating and whether goods are in stock, issuing an order to the warehouse, invoicing the customer and updating the inventory records.

Question 11

Higher customer service standards normally mean _______ costs as inventory levels need to be higher.

Accepted Answer

Higher customer service standards require a higher level of inventory to be maintained to ensure prompt delivery. This leads to increased holding costs and overall higher costs.

Question 12

Warehousing decisions are required in the storing of goods between the time they are produced and the time they are transported to the customer. These warehousing activities include _______.

Accepted Answer

Warehousing decisions include breaking bulk, which is the process of taking large quantities of products and dividing them into smaller units for individual purchase or use. Storage and loading are also essential warehousing activities, as they involve the safe and efficient storage of products and the loading of items onto vehicles for transport. Finally, making up product assortments for delivery to customers involves selecting and combining different products or quantities of products to fulfill specific customer orders. Therefore, all of the above options are necessary for effective warehousing management.

Question 13

Retailing organizations use regional _______ centres, where suppliers deliver products in bulk. These shipments are broken down into loads that are then quickly transported to retail outlets.

Accepted Answer

Retailing organizations use regional distribution centres to receive shipments from suppliers and then transport those products to retail outlets. The distribution centres are responsible for breaking down bulk shipments into smaller loads and efficiently moving those loads to their final destination. Storage and inventory management may occur at the distribution centre, but these activities are secondary to the primary role of distributing products. Service is not directly related to this process.

Question 14

In general, suppliers have greater power in the distribution channel than supermarket chains.

Accepted Answer

Generally, supermarket chains have greater power in the distribution channel than suppliers. Supermarkets have the ability to dictate terms, prices, and quantities to suppliers due to their larger size and purchasing power. They can easily switch to another supplier if they are not satisfied with the terms offered. On the other hand, suppliers may be dependent on large supermarket chains for a significant portion of their sales, giving supermarkets the upper hand in negotiations.

Question 15

EDI (Electronic data interchange) allows for which of the following?

Accepted Answer

EDI allows for the electronic exchange of business documents such as purchase orders, invoices, delivery notes, and money between companies. It does not directly enable companies to sell online or sell directly to consumers.

Question 16

The power of supermarkets is often a cause for concern as it may put pressure on _______ to lower their prices as they are so dependent on the supermarkets for their sales.

Accepted Answer

Suppliers are the ones who provide the products to the supermarkets. As the supermarkets have a large and dominant market share, they may use their bargaining power to push the suppliers to lower their prices, hence causing concern among the suppliers.

Question 17

Convenience stores may try and gain purchasing power similar to supermarket chains by adopting which of the following strategies?

Accepted Answer

Joining a buying group allows convenience stores to pool their resources and increase their purchasing power, giving them greater bargaining power with manufacturers and suppliers. Forming an administered vertical marketing system and arranging exclusive distribution rights are also potential strategies, but they are more complex and difficult to implement, especially for smaller convenience stores.

Question 18

Railways are efficient at transporting large, bulky freight on land over _______ distances.

Accepted Answer

Railways are known to be an efficient mode of transportation for bulky freights over long distances due to their ability to carry heavy loads and their lower fuel consumption compared to trucks.

Question 19

Lobby groups continue to campaign against the growth of supermarkets. One concern is that these supermarkets engage in unsustainable practices, such as shipping food from large scale suppliers in different parts of the world, ahead of using local suppliers, leaving a smaller carbon _______.

Accepted Answer

The term "carbon footprint" refers to the amount of carbon dioxide and other greenhouse gases emitted by a particular activity or entity, such as a business operation or product. Therefore, option B is the most appropriate choice to complete the sentence.

Question 20

The key elements of the physical distribution system are customer service; order processing; _______ control; warehousing; transportation and materials handling.

Accepted Answer

Inventory control is a crucial aspect of physical distribution system as it involves managing the quantity and location of inventory, minimizing stockouts and overstocking, and ensuring timely availability of products to customers. The other elements mentioned are also important but do not directly deal with inventory management.

Quiz 9: Distribution: Delivering Customer Value