Question 1

Ultimately, ________________ can occur in which channel members experience disagreements and their relationship can become strained or fall apart.

Accepted Answer

Channel conflict occurs when there are disagreements between channel members, leading to strained relationships or even dissolution of the channel. Channel power, expert power, reward power, and coercive power may all contribute to the conflict, but they are not the ultimate outcome.

Question 2

_____________ is the shortening or collapsing of marketing channels due to the elimination of one or more intermediaries, and is common in the electronic channel.

Accepted Answer

Disintermediation is the process of eliminating intermediaries in a marketing channel, which is commonly observed in electronic channels. It leads to a shortened or collapsed marketing channel, with fewer intermediaries involved in the distribution process. This can happen due to the ease of communication and direct interaction between buyers and sellers in the online environment, which eliminates the need for intermediaries such as wholesalers or retailers.

Question 3

____________ consists of vertically aligned networks behaving and performing as a unified system.

Accepted Answer

A Vertical Marketing System (VMS) consists of a producer, wholesaler, and retailer acting as a unified system. They work together to meet consumer needs and improve efficiency. In a VMS, the members are vertically aligned with one another, creating a mutually beneficial relationship.

Question 4

Through a __________________, retailers contract for varying degrees of exclusive dealings with a particular wholesaler.

Accepted Answer

The answer of Through a __________________, retailers contract for varying...

Question 5

In a(n)________________, the sheer size and power of one of the channel members places it in a position of channel control.

Accepted Answer

In an Administered VMS, one channel member, due to its size and power, can exert significant influence and control over the other members of the distribution channel.

Question 6

Entrepreneur magazine reports that ________________ remain the highest-potential startup and growth mechanism for small-business owners, and it is an effective way to expand a distribution channel quickly and efficiently.

Accepted Answer

Entrepreneur magazine reports that franchises remain the highest-potential startup and growth mechanism for small-business owners. Franchising allows small-business owners to expand their distribution channel quickly and efficiently by partnering with a larger, established brand.

Question 7

The goal of the ________________ is to share resources, especially knowledge-based resources, to effect optimally profitable relationships between two channel members.

Accepted Answer

Partner Relationship Management (PRM) Strategies aim to facilitate the exchange of resources, particularly knowledge-based resources, between two channel members to establish mutually beneficial relationships. The other options are not relevant to this particular concept.

Question 8

___________ is the approach that is attractive for many firms whose core competencies do not include elements of supply chain management.

Accepted Answer

Insourcing is the approach where firms decide to perform all or some of their logistics functions in-house rather than outsourcing to third-party logistics providers. This approach is attractive for many firms whose core competencies do not include supply chain management expertise. By insourcing, firms can have better control over the quality of the services provided and can also reduce the risk of losing control over their operations. This approach is particularly beneficial for companies that have specialized and unique processes, products or services that require constant monitoring and refining.

Question 9

By combining efforts, ____________ gain advantages through enhanced buying and distribution power, that allow them to better compete with supermarket chains than if the stores were buying separately.

Accepted Answer

Retailer cooperatives are formed by independent retailers who join together to form a cooperative that buys merchandise and advertising collectively. By pooling their resources, they gain advantages such as enhanced buying and distribution power, which allows them to better compete with larger supermarket chains. Franchise organizations involve a contractual relationship between a franchisor and franchisees, and do not necessarily involve cooperation among independent retailers. Wholesaler cooperatives involve cooperation among wholesalers rather than retailers. Channel captains are dominant members of a distribution channel who coordinate the activities of other members, and partner relationship management (PRM) strategies refer to managing relationships with customers and suppliers rather than cooperation among retailers.

Question 10

Introducing one intermediary into a channel can contribute to greatly _______________ that are necessary to complete an exchange.

Accepted Answer

Channels with intermediaries actually tend to save end-user consumers money over what most direct producer-to-consumer distribution approaches would cost, given the same product.

Question 11

In an administered VMS, the sheer size and power of one of the channel members places it in a position of channel control.The lead player in such situations may be referred to as the ______________, signifying its ability to control many aspects of that channel's operations.

Accepted Answer

The term "channel captain" is used to describe the lead player in an administered VMS who has the ability to control many aspects of the channel's operations.

Question 12

Financing, market research, risk-taking, and other services are considered to be _________________________.

Accepted Answer

Financing, market research, risk-taking, and other services are all functions that facilitate business operations, hence they are considered facilitating functions.

Question 13

In ________________ a channel member has invested in backward or forward vertical integration by buying a controlling interest in other intermediaries.

Accepted Answer

In a Corporate Vertical Marketing System (VMS), a single company owns multiple levels of the distribution or production process, achieving control through ownership rather than contracts or influence.

Question 14

Nadia works for a major soda distributor.Recently the company has begun to discuss buying a transportation company to move their product from their own manufacturing facility to the consumer.This is an example of _______________.

Accepted Answer

This is an example of a Corporate Vertical Marketing System (VMS), where a company owns multiple levels of its supply chain, in this case, by acquiring a transportation company to control the distribution of its products.

Question 15

A(n)________________ creates a powerful competitive advantage in the marketplace due to cost and process efficiencies realized when a channel is strictly controlled by one entity.

Accepted Answer

The answer of A(n)________________ creates a powerful competitive advantage in...

Question 16

A (n)__________________ consists of otherwise independent entities that are bound together legally through contractual agreement.

Accepted Answer

A contractual VMS consists of independent entities that are legally bound together through contractual agreement.

Question 17

Producers make money by pushing finished goods out the door and into the channel of distribution.As such, the most commonly provided channel intermediary activities are _______________.

Accepted Answer

Relatively few producers operate their own transportation networks or provide warehousing facilities. Producers make money by pushing finished goods out the door and into the channel of distribution. As such, transportation and storage functions are among the most commonly provided channel intermediary activities.

Question 18

Facilitating functions performed by intermediaries include a variety of activities that help fulfill completed transactions and also maintain the viability of the channel relationships.These include ________________.

Accepted Answer

Facilitating functions by intermediaries include financing and market research, as these activities help in completing transactions and maintaining channel relationships. Buying is a transactional function, not a facilitating one.

Question 19

It is possible that a(n)________________ can be more formally structured through strategic alliances and partnership agreements among channel members that agree to work in mutual cooperation.An example of this is the relationship between Wal-Mart and Procter& Gamble.

Accepted Answer

An Administered VMS is a type of vertical marketing system where coordination and cooperation among channel members are achieved through the power and influence of one dominant member, such as Wal-Mart in its relationship with Procter & Gamble.

Question 20

______________ is the degree to which any member of a marketing channel can exercise influence over the other members of the channel.

Accepted Answer

Channel power refers to the ability of any member of the marketing channel to influence the behavior of other members. This power may come from various sources such as size, reputation, resource control, or expertise. Understanding channel power is important as it can affect the balance of power and control in the channel, leading to conflicts or cooperation.

Quiz 15: Managing Marketing Channels and the Supply Chain