1
Which has not been a contributing factor to the expansion of international retailers?
(A)
Enhanced data communications
(B)
New forms of international financing
(C)
Lower governmental barriers to entry
(D)
Lower political risk
2
French Bakery Breads is planning on entering the Venezuelan market. Compared to the
U.S., the firm should expect
(A)
(B)
(C)
(D)
3
U.K.-based Tottenham Tartans is planning to enter the U.S. market using exclusive
distribution. It should expect
(A)
relatively short channels
(B)
relatively long channel
(C)
to be channel captain
(D)
to minimize sales tax in the U.S.
4
U.K.-based Tottenham Tartans is planning to enter the U.S. market using exclusive
distribution. This is a good idea if
(A)
the firm wants to avoid making any channel management decisions
(B)
the firm wants their products to be widely available
(C)
their brand is unknown in the U.S.
(D)
their brand inspires consumer loyalty
5
Action Toys is thinking about terminating a distributor in an overseas market. What might
the firm be liable for upon termination?
(A)
Compensating the various channel captains
(B)
The local goodwill the distributor has built up for the brand
(C)
All outstanding sales taxes
(D)
None of the above
6
Indopharm is planning to export to Taiwan and is investigating local distributors. A large,
well-respected firm is interested, but this firm will likely become the channel captain. Is
this good for Indopharm?
(A)
Yes. You always want a large firm to be your channel captain
(B)
Yes. You always want a well-respected firm to be your channel captain
(C)
No. Indopharm will lose control over is pricing
(D)
It doesn’t matter who the channel captain is
7
French Bakery Breads is hoping to sell to Wal-Mart in Mexico. What should it expect?
(A)
Wal-Mart may be the channel captain
(B)
Wal-Mart will want French Bakery Breads to be channel captain
(C)
Wal-Mart will be totally different in Mexico than it is in the U.S.
(D)
Wal-mart is no longer in Mexico
8
French Bakery Breads wants to be channel captain in Mexico. It should
(A)
look for a very large wholesaler
(B)
sell to Wal-Mart
(C)
be prepared to relinquish control over its pricing in Mexico
(D)
None of the above
9
Canon Car Mirrors is expecting to be channel captain in Japan. Nonetheless, it should
expect to comply with
(A)
product design suggestions from its distributors
(B)
pricing terms from its distributors
(C)
delivery terms suggestions from its distributors
(D)
None of the above
10
Canon Car Mirrors plans on entering Brazil where a major wholesaler will be channel
captain. Canon will need to budget for which costs?
(A)
Initial distribution costs
(B)
Maintenance distribution costs
(C)
Logistics costs
(D)
All of the above
11
French Bakery Breads produces a product line with a short shelf life. In Mexico it should
(A)
choose exclusive distribution
(B)
look for shorter channels
(C)
NOT be a channel captain
(D)
NOT sell to Wal-Mart
12
Texas Taffy is planning to enter Mexico using exclusive rather than extensive distribution.
This decision should
(A)
shorten channels
(B)
lengthen channels
(C)
increase market coverage
(D)
None of the above
13
Canon Car Mirrors is planning on entering the Egyptian market and wants to achieve
extensive distribution. It should expect
(A)
shorter channels
(B)
longer channels
(C)
exclusive coverage
(D)
not to be channel captain
14
In which foreign market has Wal-Mart been the most successful?
(A)
Egypt
(B)
Germany
(C)
Mexico
(D)
Brazil
15
Which country heavily regulates door-to-door selling?
(A)
Germany
(B)
China
(C)
Russia
(D)
Saudi Arabia
16
Retailers such as Starbucks that export their retail model virtually unchanged are called
(A)
replicators
(B)
performance managers
(C)
reinventors
(D)
global-local formatters
17
Retailers such as Carrefour that employ standardized back-end systems and processes
while creating largely tailored retail formats for each overseas market are called
(A)
replicators
(B)
performance managers
(C)
reinventors
(D)
global-local formatters
18
Retailers such as Ahold that expand globally by acquiring existing retail businesses that
retain their independent identities are
(A)
replicators
(B)
performance managers
(C)
re-inventors
(D)
global-local formatters
19
The highest percentage of online purchasers relative to Internet users is found in
________.
(A)
Brazil
(B)
China
(C)
South Korea
(D)
United States
20
After trade liberalization, some smugglers turned to
(A)
counterfeiting
(B)
money laundering
(C)
Both a and b
(D)
None of the above
21
A major earthquake and tsunami in Japan
(A)
shifted channel power to retailers
(B)
shifted channel power to wholesalers
(C)
disrupted global supply chains
(D)
raised oil prices and increased distribution costs
22
Retailers may face ________.
(A)
land use laws
(B)
local content regulations
(C)
restrictions on opening hours
(D)
All of the above
23
Tunetoy wants to terminate its distributor in a developing country. Tunetoy may discover
that termination is
(A)
difficult legally
(B)
not culturally acceptable
(C)
expensive
(D)
All of the above
24
LeBlanc Enterprises is considering a distributor for Japan. LeBlanc will be expected to
(A)
choose extensive distribution
(B)
choose selective distribution
(C)
choose exclusive distribution
(D)
commit for the long-term
25
^___^ refers to the amount of exposure or coverage desired for a product, particularly the
number of sales outlets required to provide for adequate coverage of the entire market.
26
^___^ is defined as the number of intermediaries involved in bringing a given product from
the firm to the consumer.
27
For specialty goods, products that inspire consumer loyalty to specific brands, a(n) ^___^
distribution is required.
28
^___^ costs comprise the transportation expenses, storage costs, the cost of breaking bulk
shipments into smaller lot sizes, and the cost for customs paperwork.
29
A channel is considered ^___^ when a newcomer cannot easily convince any channel
member to participate despite the fact that both market and economic reasons suggest
otherwise.
30
^___^ is the illegal transport of legal or illegal products across national borders.
31
^___^ refers to the coordination of various channel members to the end of providing a
unified approach to a product or service.
32
The ^___^ is the dominant channel participant, dictating terms of pricing and delivery.
33
Retailers such as Starbucks that export their retail model virtually unchanged are called
^___^.
34
ABC Automobiles has heard that someone is smuggling their cars into a Latin American
country where there are no tariffs or quotas on automobiles. What advice would you give
ABC Autos?
(A)
Due to their size and weight, automobiles are rarely smuggled
(B)
Organized crime could be involved
(C)
Latin American governments encourage smugglers
(D)
Smuggling will not occur in the absence of tariffs or quotas
35
World Cigarettes, a British MNC, has heard that someone is smuggling their cigarettes into
a Latin American country where there are no tariffs or quotas on cigarettes. What advice
would you give World Cigarettes?
(A)
Organized crime could be involved
(B)
This report is unlikely because the smuggling of cigarettes has largely been eradicated
worldwide
(C)
Latin American governments encourage smugglers
(D)
Smuggling will not occur in the absence of tariffs or quotas
36
World Cigarettes, a British MNC, is accused of assisting smugglers of cigarettes into
Nigeria. Why would the firm participate with smugglers?
(A)
To avoid money laundering
(B)
To avoid taxes
(C)
Both a and b
(D)
There is no reason for an MNC to cooperate with smugglers because smuggling hurts MNCs
37
Karavel Foods is planning to piggyback in Chile on the distribution of CFG, a major Chilean
packaged foods company. Karavel should expect CFG to
(A)
put the CFG name on Karavel products
(B)
decide the pricing for Karavel products
(C)
provide advertising for Karavel products
(D)
None of the above
38
Indopharm is planning to piggyback in Canada using the distribution of a U.S.
pharmaceutical firm. Indopharm can expect the U.S. company to
(A)
keep the Indopharm name on the products
(B)
decide the pricing of Indopharm products
(C)
provide advertising for Indopharm products
(D)
U.S. companies cannot provide piggyback services in Canada
39
DISINT is a direct sales firm that markets cosmetics and women’s accessories. DISINT is
planning on entering Brazil. What advice would you give to the company?
(A)
Customers will pay more to buy the product from someone they know
(B)
Women are not decision makers in Brazil
(C)
Direct sales are virtually unknown in Brazil
(D)
None of the above
40
DISINT is a direct sales firm that markets cosmetics and women’s accessories. DISINT is
planning on entering Brazil. What advice would you give to the company?
(A)
Customers will expect to pay considerably less if they buy from someone they know
(B)
Direct sales are culturally unacceptable in Brazil
(C)
Direct sales appeals to Brazil’s collectivist culture
(D)
Direct sales appeals to Brazil’s hierarchal culture
41
DISINT is a direct sales firm that markets cosmetics and women’s accessories. DISINT is
planning on entering Brazil. What advice would you give to the company?
(A)
They will face competition from other U.S. direct sales firms
(B)
They will face competition from Brazilian direct sales firms
(C)
Both a and b
(D)
Brazil closely monitors direct sales and once disallowed them for a five-year period
42
Coco Discount Outlets plans to adopt a performance manager style of internationalization.
It is likely that Coco will
(A)
move quickly into international markets
(B)
take advantage of its expertise in corporate finance
(C)
acquire foreign retailers
(D)
All of the above
43
Coco Discount Outlets plans to adopt a reinventor style of internationalization. It is unlikely
that Coco will
(A)
employ standard back-end systems
(B)
create stores largely tailored to each overseas market
(C)
exploit its experience in retail logistics
(D)
export its retail format virtually unchanged
44
Coco Discount Outlets plans to adopt a replicator style of internationalization. It is unlikely
that Coco will
(A)
identify markets where its home market model will work
(B)
move relatively slowly overseas
(C)
follow in the footsteps of Starbacks
(D)
capture economies of scale
45
Coco Discount Outlets plans to adopt a replicator style of internationalization. It is likely
that Coco will
(A)
identify markets where its home market model will work
(B)
move relatively quickly overseas
(C)
capture economies of scale
(D)
All of the above
46
Retailers that employ standardized back-end systems and processes while creating largely
tailored retail formats for each overseas market are called ^___^.
47
Channel length refers to the number of sales outlets.
(A)
True
(B)
False
48
To reduce inventory levels, a number of companies have adopted just-in-time (JIT)
deliveries of parts and components.
(A)
True
(B)
False
49
In developed countries, there is a trend towards fewer larger retailers.
(A)
True
(B)
False
50
In Latin America, small stores account for the majority of total in-store sales.
(A)
True
(B)
False
51
Overall, U.S. retailers have entered foreign markets later than European retailers.
(A)
True
(B)
False
52
Wal-Mart has been successful in every foreign market it has entered.
(A)
True
(B)
False
53
Direct marketing is popular in developing countries due to their excellent
telecommunications infrastructure.
(A)
True
(B)
False
54
Smuggled goods are subjected to sales taxes, but they do not pay import tariffs.
(A)
True
(B)
False
55
Retailers that export their retail model virtually unchanged are called replicators.
(A)
True
(B)
False
56
Retailers that export their retail model virtually unchanged are called reinventors.
(A)
True
(B)
False
57
For short lead-time situations, slower modes of transportation are used.
(A)
True
(B)
False
58
Terminating agreements with distributors is easier in Japan than in the United States.
(A)
True
(B)
False
59
In locked-up channels, a newcomer cannot easily convince any channel member to add or
drop products in spite of favorable market conditions.
(A)
True
(B)
False
60
Business-to-business sales usually involve numerous intermediaries.
(A)
True
(B)
False
61
Channel density refers to the number of intermediaries between the manufacturer and the
consumer.
(A)
True
(B)
False
62
A channel captain is the dominant member of the channel and is responsible for
profitability of the entire channel.
(A)
True
(B)
False
63
Logistics costs include costs of maintaining the sales force, sales managers, and their
travel expenses.
(A)
True
(B)
False
64
As distribution costs for a product increase, the cost of the final product decreases.
(A)
True
(B)
False
65
Longer channels with powerful distributors give manufacturers more control over the
entire distribution process.
(A)
True
(B)
False
66
The German embassy may be a good source of information on locating agents or
distributors in Germany.
(A)
True
(B)
False
67
The financial incentive is one of the best options to keep channel members motivated.
(A)
True
(B)
False
68
Over-saturating a market with many distributors keeps distributors motivated.
(A)
True
(B)
False
69
The highest percentage online purchasers relative to Internet users is in South Korea.
(A)
True
(B)
False
70
The highest percentage online purchasers relative to Internet users is in Great Britain.
(A)
True
(B)
False
71
A channel in which newcomers cannot easily convince any channel member to participate
despite both market and economic reasons suggesting otherwise is called a __________
channel.
(A)
closed
(B)
locked-up
(C)
saturated
(D)
high density
72
Locked-up channels are especially common in
(A)
Britain
(B)
Japan
(C)
Mexico
(D)
the United States
73
In Japan, foreign firms are expected to
(A)
make the wholesaler the channel leader
(B)
make the retailer the channel leader
(C)
commit to long-term relationships with their distributors
(D)
get the government’s approval to add a wholesaler
74
When a company does not find channel partners with sufficient interest to pioneer new
products, the company can resort to
(A)
smuggling
(B)
countertrade
(C)
piggybacking
(D)
parallel imports
75
In a piggyback agreement,
(A)
the manufacturer retains control over marketing strategies
(B)
the distributor controls marketing strategies
(C)
no one has channel control
(D)
the manufacturer has no channel control
76
Piggybacking is common in which industry?
(A)
Cut flowers
(B)
Automobiles
(C)
Pharmaceuticals
(D)
Fast food
77
Under a piggybacking agreement, which part of the marketing mix does the manufacturer
cede control?
(A)
Product
(B)
Promotion
(C)
Pricing
(D)
Distribution
78
What factor influences the selection of a transportation management system?
(A)
Transit time
(B)
Lead time
(C)
Transportation costs
(D)
All of the above
79
Cut flowers from Colombia that are sold in the U.S. market are most likely shipped by
(A)
air
(B)
truck
(C)
sea
(D)
bus
80
A common complaint by multinational corporations about distributors in developing
countries is that
(A)
they want to be channel leaders
(B)
they fail to invest in business growth
(C)
there is too much channel conflict
(D)
they are always haggling for higher margins
81
Cancellation of distribution rights may be problematic in foreign markets due to
(A)
social norms
(B)
local laws
(C)
the cost involved
(D)
All of the above
82
What can lead to channel conflict?
(A)
Excellent financial incentives
(B)
Making distributors more involved in marketing
(C)
Extensive training of distributors
(D)
Oversaturating the market with too many distributors
83
The highest percentage online purchasers relative to Internet users is in the United States.
(A)
True
(B)
False
84
Eliminating tariffs will eliminate smuggling.
(A)
True
(B)
False
85
In Japan, wholesalers may assist retailers with
(A)
financing
(B)
product development
(C)
marketing skills
(D)
All of the above
86
Channel length refers to the
(A)
number of sales outlets
(B)
physical flow of goods
(C)
distance between manufacturer and retailer
(D)
number of intermediaries between a firm and its customers
87
For products with short shelf lives,
(A)
long channels are preferred
(B)
direct sales agents are required
(C)
short channels are preferred
(D)
All of the above
88
Channel alignment refers to
(A)
coordination between channel members
(B)
being located close to channel partners
(C)
being located faraway from channel partners
(D)
being located along a straight line
89
Which is not a common source of foreign distributor information for U.S. firms?
(A)
Industry associations
(B)
Trade shows
(C)
U.S. Department of Commerce
(D)
WTO
90
Which is a source of foreign distributor information for U.S. firms?
(A)
IMF
(B)
U.S. Justice Department
(C)
U.S. Department of Commerce
(D)
WTO
91
More intense contact between an export manufacturer and its distributor in a foreign
market will likely result in
(A)
a change in channel captain
(B)
better performance by the distributor
(C)
higher margins to the exporter
(D)
higher margins to the importers
92
An example of a system that reduces inventory levels is the
(A)
global manufacturing system
(B)
just-in-time system
(C)
modular system
(D)
None of the above