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Chapter 18—International Channel Perspectives
MULTIPLE CHOICE
1. In an attempt to penetrate the market in mainland China, General Motors (GM) intends for its
dealers to be the best in the world by employing which of the following tactics at GM
dealerships in China?
a.
Customers are greeted by attendants in elegantly designed showroom entrances.
b.
Customers may be offered cigars.
c.
Customers may be treated to Napa Valle wines at a black-marble bar.
d.
Luxurious VIP rooms are available to customers.
e.
All of the above.
2. As we continue into the twenty-first century, __________ and __________ are making the
need for international marketing an inescapable reality for more and more American firms.
a.
rapid domestic growth; rapid export growth
b.
slow domestic growth; little demand for American products overseas
c.
fierce foreign competition; slower domestic growth
d.
shrinking foreign markets; rapid domestic growth
e.
decreasing U.S. population; high export prices
3. U.S. manufacturers are looking to international markets because:
a.
Of slower growth in domestic markets.
b.
Foreign markets have less political risk.
c.
Of government regulations.
d.
New customers to buy products.
e.
No competition in foreign markets.
4. All of the following channel environments apply to both domestic and international channels
except:
a.
Competitive.
b.
Economic.
c.
Sociocultural.
d.
Technological.
e.
Customer.
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5. When a firm becomes involved in international marketing:
a.
It can establish one international channel that will apply in most countries.
b.
It is actually faced with fewer unknowns because of the high degree of regulation
in most foreign environments.
c.
The basic concepts and approaches to channel management remain the same.
d.
The establishment of an international division is a virtual must.
e.
It must attempt to project its domestic experiences into the international
environment before proceeding.
6. With regard to economic factors in foreign environments it should be noted that all of the
following may occur except:
a.
Inflation may be much higher.
b.
Recessions can be more severe.
c.
Interest rates could be higher.
d.
Technology is changing at a rapid pace.
e.
Fluctuations in foreign exchange.
7. Economic factors particularly important to international marketers include all of the following
except:
a.
Political risk.
b.
Commodity prices.
c.
Growth trends.
d.
Currency exchange rates.
e.
Inflation.
8. When the dollar became weaker relative to the Euro, U.S. manufacturers:
a.
Were concerned because their goods would become more expensive in European
markets.
b.
Were pleased because their goods would be cheaper in Europe.
c.
Knew sales of their products would increase in Asia because prices would be lower
to consumers.
d.
Were concerned that sales in Mexico would decrease because the Euro was strong
and this increased the price of goods.
e.
Were unconcerned.
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9. By the late 1990s, the devaluation of many Asian currencies had made the U.S. dollar:
a.
Weaker against the Asian currencies.
b.
Stronger against the Asian currencies.
c.
Little changed against the Asian currencies.
d.
On a par with Asian currencies.
e.
More easily convertible into Asian currencies.
10. In foreign countries, the competitive environment is:
a.
Fairly constant across Western countries.
b.
Much more free and open than in the U.S.
c.
Much less intense than in the U.S.
d.
About the same as it is in the U.S.
e.
Not open to free competition, especially in developing markets.
11. All of the following sociocultural variables tend to vary around the world except:
a.
Cultural values.
b.
Behavioral norms.
c.
Attitudes.
d.
Perceptions.
e.
Competition.
12. Ben and Jerry’s found the Russian sociocultural environment to be very different from the
business culture in the United States. Which of the following statements does not accurately
describe the business culture in Russia when this occurred?
a.
Indifference to on-time delivery.
b.
Distributors had monopoly positions in the market.
c.
Distributors had ties to organized crime.
d.
High regard for customer service.
e.
Low levels of efficiency.
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13. The channel variable of the marketing mix is especially sensitive because it often involves
_________________ than the other variables.
a.
higher levels of organization.
b.
more person-to-person contact.
c.
supervision of all channel members.
d.
increased levels of evaluation.
e.
more careful selection of channel members.
14. According to the environmental classification scheme used in the text, foreign government
regulations that limit the type of stores selling certain products should be classified as in the:
a.
Sociocultural environment.
b.
Economic environment.
c.
Competitive environment.
d.
Global environment.
e.
Legal environment.
15. International variances in the adoption of technological change can especially affect the
__________ flow.
a.
negotiation
b.
product
c.
power
d.
control
e.
hydro
16. According to the textbook, Ito-Yokado Co., the Japanese firm that controls 7-Eleven Stores in
Japan has:
a.
Limited technological sophistication.
b.
Ignored modern information systems and emphasized Japanese tradition.
c.
Avoided the cost of modern computer systems through the use of “kanban”.
d.
The ability to precisely manage distribution and merchandising in almost 7,000
stores.
e.
Connections to many Japanese keitesu.
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17. The availability of low-cost technology coupled with the capabilities of foreign distributors
has led to substantial:
a.
Increases in exports by small U.S. manufacturers.
b.
Decreases in exports by small U.S. manufacturers.
c.
Disadvantages for large scale U.S. manufacturers seeking to export.
d.
Declines in the number of small U.S. firms seeking to export.
e.
Decreases in costs.
18. Which of the following is not considered a potential legal factor that makes distribution in
international marketing more difficult and complicated?
a.
Tariffs
I
Import restrictions
c.
Quotas
d.
Horizontal competition
e.
Regulations
19. Technology, which has become so important to successful marketing domestically:
a.
Is just as important in international marketing.
b.
Is as important when dealing with highly developed foreign countries but much
less important when dealing with smaller, less-developed countries.
c.
Is far too advanced for use in most foreign countries.
d.
Cannot work in most foreign environments because of the differing levels of
technological expertise.
e.
Is more important in less-developed countries because firms must invest in setting
up a technology infrastructure.
20. Behavioral dimensions in international marketing channels are:
a.
Relatively straightforward in most international situations.
b.
Associated mainly with resolving conflict situations.
c.
Almost of equal concern as they are in domestic channels.
d.
Based almost exclusively on power.
e.
Important for the channel manager to understand.
International Channel Perspectives
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21. The basic steps in the paradigm for designing marketing channels are:
a.
The same in domestic and international settings.
b.
Different because two phases, 4 and 6, change for domestic vs. international
channels.
c.
Different only with regard to phase 7, selecting the channel members.
d.
Completely altered because of the foreign production option.
e.
Different throughout all phases.
22. Which of the following is not regarded as a form of indirect exporting?
a.
Use of foreign distributors
b.
Use of a trading company
c.
Use of an export management company
d.
Use of a cooperative (piggyback) arrangement
e.
Casual exporting
23. ___________ is when one firm uses the international expertise and capabilities of another
firm to enter a foreign market.
a.
Export management
b.
Cooperative arrangement
c.
Piggybacking
d.
Casual exporting
e.
Direct exporting
24. When the manufacturer is involved in direct exporting:
a.
It is unlikely that foreign distributors will be used.
b.
An overseas marketing subsidiary must be established.
c.
The firm gets directly involved in exporting.
d.
The firm does not need to make market contacts.
e.
The firm delegates all of the exporting tasks to others intermediaries.
25. U.S. firms competing in foreign markets are __________ the anti-collusion provisions of the
U.S. trade laws.
a.
rarely prosecuted for violating
b.
exempted from
c.
severely restricted by
d.
somewhat restricted by
e.
U.S. trade law does not apply here.
Marketing Channels 8e
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26. Which of the following is considered a foreign production approach to international
marketing?
a.
Trading company
b.
Joint venture
c.
Overseas marketing subsidiary
d.
Export management company
e.
Using trading intermediaries
27. U.S. manufacturers involved in direct exporting:
a.
By definition, do not use foreign intermediaries.
b.
Delegate all distribution tasks directly to foreign nationals.
c.
Assume responsibility for all logistics functions.
d.
Are the most frequent users of cooperative (piggyback) exporting.
e.
Are directly involved in exporting, including pricing and distribution tasks.
28. _________ are independent businesses used by firms directly exporting to international
markets, but they generally do not take title to nor physical possession of goods.
a.
Foreign agents
b.
Foreign distributors
c.
Trade intermediaries
d.
Trading companies
e.
Cooperatives
29. With regard to the variables the channel manager should consider when choosing a channel in
domestic vs. international channels, it is fair to say that:
a.
The basic categories of variables are the same.
b.
Far more detailed categories of variables exist in international settings.
c.
The categories are different, but most of the variables are the same.
d.
The categories and the variables are all different.
e.
There are fewer variables.
30. The specific variables that should be considered when choosing a foreign channel should be:
a.
Generalized for geographically contiguous foreign countries.
b.
Projected from the United States to other Western environments.
c.
Universally applied to gain greater efficiency.
d.
Considered on a case-by-case basis.
e.
Generalized for the market, product, and environmental categories.
International Channel Perspectives
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31. The actual choice of channel structure for international markets should be:
a.
Mandatory for firms doing business in international markets.
b.
Determined ahead of time and be standardized.
c.
Done so as to make for the shortest possible channel.
d.
Done on a case-by-case basis.
e.
Developed after contracting with a foreign trading company.
32. The most common approach for choosing international channel structures is:
a.
Competitive comparisons.
b.
Distribution costing.
c.
Judgmental-heuristic.
d.
Exchange rate analysis.
e.
Transaction cost analysis.
33. U.S. manufacturers’ standard domestic _________ often are inadequate to meet foreign
channel members’ needs.
a.
credit terms
b.
accounting policies
c.
prices
d.
cost structures
e.
supervisory practices
34. Massive international advertising by well-known U.S. firms has proven to be of substantial
benefit to:
a.
Foreign firms selling competitive products.
b.
Private label manufacturers.
c.
Foreign distributors selling well-known U.S. products.
d.
Foreign firms seeking to export their products to the U.S.
e.
Small U.S. businesses competing in the same foreign market.
35. All of the following are true about foreign intermediaries except:
a.
They are often underfinanced.
b.
They stock limited assortments of products.
c.
They are often quite small by U.S. standards.
d.
They often expect long credit terms.
e.
They often have a relatively low cost structure due to economies of scale.
Marketing Channels 8e
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36. The motivational program most frequently used by U.S. manufacturers for their foreign
channel members is:
a.
Distribution programming.
b.
Partnership.
c.
Strategic alliance.
d.
Cooperative.
e.
Coercive leadership.
37. The study of manufacturer and foreign distributor relationships cited in the text found that the
best relationships existed when:
a.
A high degree of personal contact between manufacturer and foreign distributors
was maintained through personal visits, various communications.
b.
Travel was kept to a minimum.
c.
Massive monetary incentives were used.
d.
Marketing strategy decisions were made by the foreign manufacturer and
communicated immediately to the foreign distributors.
e.
Roles and routines are rigidly set.
38. It is important for channel managers to pay attention to local customs and traditions. For
example, in the Middle East agents and distributors define marketing as:
a.
Advertising.
b.
Sitting on the product and waiting for the customer.
c.
Aggressive personal selling.
d.
Negotiating over price.
e.
Geographic territory.