98. One thing that sets service distribution apart from traditional manufacturing distribution is that in a
service environment:
a.
production and consumption are simultaneous
b.
production setbacks can be remedied by using safety stock
c.
faster modes of transportation can offset service production problems
d.
service distribution benefits are more tangible
e.
service distribution has a narrower focus
99. Which of the following businesses is most likely to have a problem with distribution because
production and consumption of the product occurs simultaneously?
a.
A company that manufacturers bicycles
b.
A hair salon
c.
A retailer that sells mattresses
d.
A soft-drink bottler
e.
A wholesaler that specializes in athletic equipment
100. You are responsible for physical distribution of your company’s service and should focus on:
a.
ensuring the intangibility of the service so that physical distribution becomes a less
important factor
b.
minimizing wait times, managing service capacity, improving service delivery, and
establishing channel-wide network coherence
c.
making sure production and consumption are simultaneous
d.
setting quality standards, choosing faster transportation modes, and using safety stock
e.
customer-oriented order processing and inventory control
101. Which of the following is a main area of concern for service distribution?
a.
Minimizing wait times
b.
Maximizing sales
c.
Creating a one-to-one relationship with customers
d.
Providing easy to use Internet help
e.
Reducing risk
102. Paul operates Kayak.com a company that allows customers to efficiently search company databases
and find the best airline and hotel deals all over the Web. Kayak does not make bookings, but rather
provides recommendations for the best travel plans. Travel providers pay Kayak a commission for
most customers who click through. English wants his users to have as short and sweet an experience
on Kayak as possible. Time is of the essence in responding to any customer question, especially in this
day where air fare can increase dramatically in just a couple of hours. Paul is devoted to:
a.
improving delivery service
b.
maximizing queues
c.
reducing discrepancies of assortment
d.
reducing wait time
e.
managing service capacity
R. H. Kurt & Son, Inc., distributes rifles for both hunting and target shooting, rifle barrels, triggers,
cleaning equipment, and reloading equipment to sporting equipment retailers and many large discount
stores. It carries products from 41 different manufacturers. The manufacturers whose products it
carries are known for producing superior products and are leaders in their industries. In addition, Kurt
is able to repair damaged rifles through its gunsmith service, which is available to all of its retailers.
103. Refer to R.H. Kurt. Its marketing channel is composed of:
a.
the distribution, objectives, strategies, and tactics used to move products from the
manufacturer to the retailer
b.
any organization that had a part in moving the product from the distributor to the retailer
c.
the functions of transportation, storage, inventory control, materials-handling, and order
processing
d.
the 41 different manufacturers, R.H. Kurt, the retailers it serves, and their customers
e.
all organizations in the industry that make it possible for a consumer to buy his or her
desired product
104. Refer to R.H. Kurt. Customers at retail stores only want one rifle or one scope. They do not want to
buy in the quantities the manufacturers need to sell. This _____ is overcome by the marketing
channels.
a.
discrepancy of quantity
b.
spatial discrepancy
c.
discrepancy of assortment
d.
discrepancy of facilitation
e.
discrepancy of possession
105. Refer to R.H. Kurt. When Kurt combines products from 41 different manufacturers into a collection
retail buyers want available at one place, it is engaging in:
a.
a transactional function
b.
creating an assortment
c.
a facilitating function
d.
integrating its promotional functions
e.
compressed distribution
106. Refer to R.H. Kurt. When Kurt solicits an order from a sporting goods store, it engages in a _____
function.
a.
logistical
b.
functional
c.
facilitating
d.
customerized
e.
transactional
107. Refer to R.H. Kurt. Given the nature of the products carried by Kurt, what level of distribution
intensity would be most appropriate?
a.
extensive
b.
intensive
c.
reflexive
d.
unitary
e.
selective
108. Refer to R.H. Kurt. If Kurt wished to make sure its gunsmith service was profitable, it must consider:
a.
how it can minimize the time a customer must wait for his or her rifle to be repaired
b.
how the opening of hunting season will affect demand for its services
c.
how to maintain an adequate staff
d.
whether to ship the repaired rifle to the customer or the retailer
e.
all of these options
Movie DVD sales represent a $16 billion market, and rentals make up another $7.5 billion. Naturally,
production studios would prefer consumers purchase DVDs rather than rent them. Production studios
like Twentieth-Century Fox, Warner Bros, and General Electric refused to sell new releases to
Redbox, a DVD vending machine company, until almost a month after new releases arrived in stores.
Redbox, the ubiquitous DVD rental red kiosks found in- and outside of convenience stores, grocery
stores, drugstores, fast-food restaurants, and Walmart, is cutting in on production companies’ profits.
These studios are tangled in lawsuits with Redbox. Sony, Paramount, and Lionsgate, on the other
hand, permit distribution through Redbox, and Disney allows third-party distribution to Redbox.
With more than 20,000 kiosks now in operation, Redbox ranks fifth in DVD rental revenues, which is
impressive considering the rental fee is only $1.00. But Blockbuster is trying to steal vending market
share by allowing NCR Corporation, known for ATM machines, to license its name to place
Blockbuster Express kiosks in similar types of locations.
109. Refer to Redbox. Warner Bros., Blockbuster, Redbox, Walmart, and third-party DVD distributors are
part of a:
a.
distribution cooperative
b.
marketing mix
c.
transportation channel
d.
marketing channel
e.
logistics system
110. Refer to Redbox. Redbox offers DVDs from several production studios, such as Disney, Sony, and
Paramount. Consumers just have to rent from Redbox instead of obtaining the DVD from the various
production studios if they want a children’s movie from Disney and an action movie from Paramount.
Thus, one kiosk provides _____ for both consumers and the production studios.
a.
contact efficiency
b.
integration
c.
synergy
d.
distribution efficiency
e.
distribution intensity
111. Refer to Redbox. Video stores that distribute DVDs usually also sell popcorn, candy, soft drinks, and
entertainment publications. Basically, they overcome discrepancies of quantity and assortment by
combining products into collections or assortment that consumers want available in one place. Which
channel function does this describe?
a.
logistical functions
b.
transactional functions
c.
facilitating functions
d.
purchasing functions
e.
secondary functions
112. Refer to Redbox. Production studios distribute DVDs in grocery stores, drug stores, discount stores,
entertainment stores, and vending machines like Redbox. Which level of distribution intensity does
this represent?
a.
intensive
b.
extensive
c.
product-focused
d.
market-focused
e.
exclusive
113. Refer to Redbox. Production studios are potentially producing _____ among its existing distributors
by allowing Redbox to rent their DVDs for $1.00.
a.
vertical conflict
b.
cognitive dissonance
c.
supply management divergence
d.
horizontal conflict
e.
disintermediation
ESSAY
1. What is a marketing channel? What type of business make up a marketing channel?
2. One important reason channel members are included between producers and users is the concept of
specialization and division of labor. Define these concepts and explain their roles in channels of
distribution.
3. One important reason channel members are included between producers and end users is to overcome
discrepancies. Name and briefly describe four discrepancies channel members overcome.
4. Describe how information technology is impacting contact efficiency.
5. One important reason channel members are included between producers and users is to increase
contact efficiency. How do channel members increase contact efficiency? Use the following two
scenarios to illustrate your answer: (1) Assume there are 2,000 business students who need to buy
textbooks from eight textbook publishers. How many transactions must take place? (2) Assume the
first scenario, but now one campus bookstore is acting as an intermediary. Now how many transactions
must take place?
6. Intermediaries must perform three basic functions. Name these functions, and describe the activities
involved in each function.
7. Compare and contrast the marketing channels for consumer products with the channels for business
and industrial products.
8. The Internet has led to the emergence of three new forms of industrial distribution. Briefly describe
and give an example of each.
9. What are the three factors affecting channel choice? Briefly discuss how each factor might influence a
company to implement a direct channel of distribution.
10. Name and briefly describe the three levels of distribution intensity. Give examples of two products that
logically would be distributed at each level of intensity.
11. A retail clothing store in a small northwest Georgia community is the sole distributor of Spanx brand
hosiery in the region. How does this form of market coverage benefit the retailer? How does it benefit
the manufacturer?
12. List and briefly define the three basic types of channel relationships. Explain why they are described
as a continuum.
13. Define channel power, channel control, channel leadership, and channel partnering and explain how
these four terms are related.
14. In international contexts, channel governance is sometimes different from that found in the United
States due to differing cultural dynamics. Use the Chinese concept of Guanxi to explain such
differences and how multinational firms must react to them.
15. Discuss the four main areas of importance in service distribution.