85) Business marketers can stimulate problem recognition by ________.
A) ensuring a presence in trade directories
B) direct mail, telemarketing, and calling on prospects
C) encouraging the Better Business Bureau to release statistics
D) using consumer advertising
E) conducting surveys of existing customers
86) With respect to e-procurement, Acosta, Ahold, Best Buy, Carrefour, Family Dollar Stores,
and several other companies joined forces to form a ________ called 1SYNC to use their
combined leverage to obtain lower prices for raw materials.
A) manufacturer’s co-op
B) supplier’s co-op
C) middleman group
D) buying alliance
E) buying cabal
87) Plastics.com allows plastics buyers to search the best prices among thousands of plastics
sellers. Plastics.com is an example of a(n) ________.
A) buying alliance
B) barter market
C) systems seller
D) vertical market
E) auction site
88) On an online ________, prices change by the minute.
A) buying alliance
B) barter market
C) systems seller
D) spot market
E) catalog site
89) With respect to e-procurement, which of the two types of e-hubs are Web sites organized
around?
A) vertical and horizontal hubs
B) vertical and functional hubs
C) functional hubs and organizational hubs
D) supplier and user hubs
E) manufacturer and supplier hubs
90) Which of the following is an example of a functional hub?
A) Plastics.com allows plastics buyers to search the best prices among thousands of plastics
sellers.
B) ChemConnect.com is an online exchange for buyers and sellers of bulk chemicals.
C) SteelMart.com concentrates on steel buyers from the United States.
D) SupplyLink.com offers manufacturers from different industries information on ensuring
workplace safety.
E) PaperTiger.com offers paper buyers a comprehensive look at the prices and quality in the
paper market.
91) The ________ approach to consumer research asks customers to attach a monetary value to
alternative levels of a given attribute. The value of a given configuration is determined by adding
the average values of each of the given attributes.
A) benchmarking
B) compositional
C) importance rating
D) focus-group
E) conjoint analysis
92) In the ________ method for assessing customer value, customers are asked how costs of
using a new product compare to those of using an incumbent product.
A) direct survey
B) importance ratings
C) field value-in-use assessment
D) benchmarking
E) conjoint analysis
93) Robert Jennings consultants help farmers deliver an incremental animal weight gain of 8 to
12 percent over competitors. This is an example of solutions ________.
A) selling to enhance customer revenues
B) selling to reduce customer costs
C) selling to decrease customer risks
D) selling to simplify customer purchasing
E) to provide better partnership
94) A supplier signs an agreement with a customer that states that $350,000 in savings will be
earned by the customer over the next 18 months in exchange for a tenfold increase in the
customer’s share of supplies ordered by the customer. If the supplier achieves less than this
promised savings, it will make up the difference. If the supplier achieves substantially more than
promised, it participates in the extra savings. This is an example of ________.
A) solution selling
B) price fixing
C) demand shifting
D) systems buying
E) risk and gain sharing
95) GM employees work at large customer facilities to reduce materials-management spending.
This is an example of the solutions to ________ form of solution selling.
A) encourage partnerships
B) alter corporate culture
C) enhance customer revenues
D) decrease customer risks
E) reduce customer costs
96) Through its dedicated research team, CISCO Systems Inc. has developed new value-added
business solutions which enable its variant class-II capacitors to provide incremental productivity
of 10 to 20 percent over its competitors. This is an example of the solutions to ________ form of
solution selling.
A) reduce customer costs
B) decrease customer risks
C) alter corporate culture
D) enhance customer revenues
E) partnerships
97) Praxair Limited is a supplier of synthetic graphite to a number of electrode manufacturers in
the United States. Its customers have shifted their ordering responsibilities to Praxair and the
company regularly monitors its customers’ inventory levels and has taken responsibility for
replenishing the supplies automatically through continuous replenishment programs. Which of
the following systems do Praxair and its customers follow with respect to order-routine
specification?
A) Supplier Added Value Effort ($AVE)
B) Vendor Managed Inventory (VMI)
C) Direct Concentrated Buying (DCB)
D) Supplier Performance Management (SPM)
E) Product Value Analysis (PVA)
98) Which of the following methods is most likely to be used by buyers to review the
performance of chosen suppliers?
A) The buyer may contact different suppliers and ask for their evaluations.
B) The buyers may rate the end-users on several criteria using a weighted-score method.
C) The buyer might aggregate the cost of poor performance to come up with adjusted costs of
purchase, including price.
D) The buyers may aggregate the opinions of various competitors and come up with the adjusted
cost of supply.
E) The buyers might adopt the Supplier Added Value Effort technique to calculate supplier
efficiency.
99) A ________ plan establishes a long-term relationship in which the supplier promises to
resupply the buyer as needed, at agreed-upon prices, over a specified period of time.
A) stockless purchase
B) direct stock purchase
C) defined contribution
D) stock purchase
E) share purchase
100) In the business market, small sellers concentrate on reaching as many participants as
possible because their chances of success are slim.
101) Framing occurs when customers are given a perspective or point of view that allows the
firm to “put its best foot forward.”
102) A performance review is the first step in the buygrid framework.
103) The buying process begins when someone places an order with a sales representative.
104) Product value analysis is an approach to efficiency that studies whether components can be
redesigned or made by more efficient methods of production without adversely impacting
product performance.
105) On spot electronic markets, prices of products or commodities change by the minute.
106) In buying alliances, participants offer to trade goods or services.
107) With respect to assessing customer value, in conjoint analysis customers are asked to rank
their preference for alternative market offerings or concepts.
108) One of the forms of solution selling is to provide solutions to enhance customer revenues.
109) Risk and gain sharing can offset price reductions that customers request.
110) Companies are increasingly reducing the number of suppliers they utilize, and there is a
trend toward single sourcing.
111) Most performance reviews are conducted by outside auditing agencies to avoid bias and
internal discrepancies.
112) Explain with examples, the concept of solution selling.
113) What are the methods available to the buyer to review the performance of the chosen
supplier? What advantage does performance review offer to the buyer?
114) Mason’s is a supplier of specialty chemicals to a number of companies. The company
previously supplied just three big clients, but the CEO is considering targeting the small business
market. Selling to small businesses presents a huge opportunity, he says, but some board
members disagree, saying it also presents huge challenges. Explain the challenges the firm might
face in targeting small businesses.
115) BEL is a small seller of specialized auto parts, while MES is a large seller of auto parts.
Both firms want to approach the same car company with a view to supplying parts to it. How
will their approaches differ?
116) With reference to online buying, what are vertical markets? Give an example of a vertical
market.
117) E-procurement Web sites are organized around two types of e-hubs. If you were in the
advertising business and were seeking to take advantage of e-procurement, what type of e-hub
should be constructed by your company?
118) KEK is a supplier of paper and paper products to several businesses. Name some contract
restrictions that KEK can use to protect its margins when dealing with price-oriented buyers.
119) Explain risk and gain sharing with the help of an example.
120) What do you understand by vendor-managed inventory (VMI)?
121) As part of the buyer selection process, buying centers must decide how many suppliers to
use. What might motivate a buyer to use multiple sources?
122) In the buygrid framework model, where the major stages of the industrial buying process
are listed and characterized, supplier selection is an important process. What follows supplier
selection and what occurs in this phase?
123) Orica Inc. competes in the market for commercial explosives. The company recently
changed its business model from just selling explosives to managing an entire blast in a quarry.
This customer-solution-based approach to the sale of explosives is an example of ________.
A) systems selling
B) straight rebuying
C) customer referencing
D) derived demand
E) channel consolidation
124) Many business buyers prefer to buy a total solution to a problem from one seller. This
process is also known as ________.
A) channel consolidation
B) systems buying
C) vertical buying
D) horizontal buying
E) supply buying
125) Which of the following is true about branding efforts at NetApp?
A) The company’s branding efforts were well organized in 2007.
B) Landor created a new identity, architecture, and tagline for it in 2008.
C) NetApp shows that business-to-business marketers do not need to worry about branding.
D) Frankensites helped organize branding efforts.
E) New Web sites for NetApp did not affect sales leads from inquiries.
126) Which of the following companies used the slogan, “The Power to Know®” to connect with
C-level executives in the largest companies?
A) Lincoln Electric
B) NetApp
C) SAS
D) Medline
E) Plexco
127) Xerox offers a ________ approach to prospective clients when it offers a complete turnkey
solution, including the operation and management of the client’s information and communication
need.
A) guided selling
B) fair trading
C) systems buying
D) cross-selling
E) local purchasing
128) If Ampex Support Systems is the single supplier for a local manufacturing company’s MRO
(maintenance, repair, operating) supplies and needs, Ampex Support Systems is considered as
providing ________ for the manufacturer.
A) guided selling
B) purchasing support
C) turnkey logistics
D) decision support
E) systems contracting
129) ________ is a key industrial marketing strategy in bidding to build large-scale industrial
products such as dams, pipelines, etc.
A) Systems contracting
B) Systems buying
C) Systems selling
D) Solutions buying
E) Turnkey logistics
130) A ________ relationship is a cooperative one where the seller adapts to meet the customers’
needs without expecting much adaptation or change in exchange.
A) customer supply
B) cooperative system
C) bare bones
D) customer is king
E) collaborative
131) In the ________ category of buyer-supplier relationships, competition rather than
cooperation is the dominant form of governance.
A) basic buying and selling
B) bare bones
C) contractual transaction
D) customer supply
E) collaborative
132) Which of the following relationships is characterized by much trust and commitment
leading to a true partnership?
A) mutually adaptive
B) collaborative
C) basic buying and selling
D) customer supply
E) cooperative systems
133) The partners in ________ systems are united in operational ways, but neither demonstrates
structural commitment through legal means or adaptation.
A) mutually adaptive
B) collaborative
C) basic buying and selling
D) customer supply
E) cooperative
134) Value Central has a partnership of high trust and commitment with certain suppliers and
gives them access to its sophisticated and detailed daily, individual store-based sales data. In
exchange, those suppliers are responsible for managing Value Central’s inventory of their
products. This relationship is best described as ________.
A) basic buying and selling
B) contractual transaction
C) collaborative
D) customer supply
E) customer is king
135) The relationship between a company and its office supplies vendor where competition
rather than cooperation is the dominant form of governance is probably best described as
________.
A) basic buying and selling
B) contractual transaction
C) collaborative
D) customer supply
E) customer is king
136) In the ________ category of buyer-supplier relationship, although bonded by a close,
cooperative relationship, the seller adapts to meet the customer’s needs without expecting much
adaptation or change on the part of the customer in exchange.
A) contractual transaction
B) cooperative system
C) collaborative
D) mutually adaptive
E) customer is king
137) According to research studies, the closest relationships between customers and suppliers
arise when ________.
A) supply is important to the customer and there were procurement obstacles
B) procurement is simple
C) there are many undifferentiated vendors in the marketplace
D) the customer is highly price sensitive
E) the suppliers charge a premium for their products
138) The type of buyer-supplier relationship in which buyers and sellers make many
relationship-specific adaptations, but without necessarily achieving strong trust or cooperation, is
referred to as ________.
A) the customer is king
B) mutually adaptive
C) collaborative
D) contractual transaction
E) customer supply
139) ________ investments are those expenditures tailored to a particular company and value
chain partner.
A) Diversified
B) Pooled
C) Specific
D) Umbrella
E) General
140) Which of the following is a form of cheating or undersupply relative to an implicit or
explicit contract which usually takes place when buyers cannot easily monitor supplier
performance?
A) institutional sale
B) business buying
C) opportunism
D) vertical integration
E) contractual transactionism
141) In buyer-seller relationships, the contractual transaction generally shows low levels of trust,
cooperation, and interaction.
142) Corporate credibility depends on corporate expertise, corporate trustworthiness, and
corporate likability.
143) One of the problems facing business-to-business on the Web is that many firms often
impose more stringent requirements on their online business partners than they do on non-online
partners.
144) The “customer is king” category of buyer-seller relationship is relatively simple, and one in
which routine exchanges with moderately high levels of cooperation and information exchange
occur.
145) Contracts are always sufficient to govern supplier transactions and prevent supplier
opportunism.
146) Vertical coordination can facilitate stronger customer-seller ties but at the same time may
increase the risk to the customer’s and supplier’s specific investments. What are specific
investments and why are they risky?
147) Researchers have found that buyer-supplier relationships differed according to four factors:
availability of alternatives; importance of supply; complexity of supply; and supply market
dynamism. Based on these four factors, they classified buyer-supplier relationships into eight
different categories. What are those categories?
148) As a seller in the business market, you have promised your customers that you have
corporate credibility as one of your corporate goals. What three factors will have some bearing
on whether you will be able to meet your goal and promise?
149) Researchers have found that buyer-supplier relationships can be classified into eight
different categories. What category would be appropriate for a relationship where, although
bonded by a close, cooperative relationship, the seller adapts to meet the customer’s needs
without expecting much adaptation or change on the part of the customer in exchange?
150) Explain the term opportunism with respect to business relationships.
151) The ________ market consists of schools, hospitals, nursing homes, prisons, and other
institutions that must provide goods and services to people in their care.
A) vertical
B) nonprofit
C) spot
D) secondary business
E) institutional
152) In most countries, ________ are the major buyers of goods and services. They typically
require suppliers to submit bids and often award the contract to the lowest bidder.
A) consumer packaged-goods companies
B) government organizations
C) health services vendors
D) educational institutions
E) households
153) What is the name of the database that is used to collect, validate, store, and disseminate data
in support of government agency acquisitions?
A) General Services Administration database
B) Central Contractor Registration database
C) Customer Value Assessment database
D) Vendor-Managed Inventory database
E) Proposal Solicitation database
154) Which of the following is a major complaint of multinationals operating in Europe?
A) each country shows favoritism toward its nationals
B) volatility of spending due to economic swings and cycles
C) required paperwork
D) bureaucracy
E) decision-making delays
155) According to the General Services Administration Procurement Data Center, more than
________ million individual contract actions are processed every year.
A) 20
B) 25
C) 30
D) 35
E) 40
156) A good illustration of a member of the institutional market would be Boeing because it is a
member of the aviation institution structure.
157) The US government is the largest customer in the world.
158) One of the chief complaints from government decision makers is that vendors have not
done their homework. What are some ways a vendor can avoid this perception?
159) Your organization is considering selling its products to the institutional market. What type
of customers will you be making your appeals to?