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219. Franchising is typical of the administered vertical marketing system.
a.
True
b.
False
220. Drawing together the processes and functions of two or more stages of the channel under one management is
horizontal integration.
a.
True
b.
False
221. Producers do not engage in horizontal integration.
a.
True
b.
False
222. Whereas the marketing channel is a group of interrelated organizations that directs products to customers, physical
distribution deals with physical movement and storage of products both within and among intermediaries.
a.
True
b.
False
223. It is rare for a channel member to manage the physical distribution of goods for all supply chain members involved in
exchanges.
a.
True
b.
False
224. The main objectives of physical distribution are decreasing costs while increasing customer service.
a.
True
b.
False
225. During order entry, a customer's credit rating is checked by the credit department.
a.
True
b.
False
a.
True
b.
False
228. Inventory management involves developing and maintaining adequate assortments of products to meet customers'
needs.
a.
True
b.
False
229. Inventory decisions seldom have a strong impact on physical distribution costs and on the level of customer service
provided.
a.
True
b.
False
230. Safety stock helps protect an organization against stockouts.
a.
True
b.
False
231. The overall safety stock, or inventory needed to prevent a stockout, depends on the general level of prices.
a.
True
b.
False
232. The reorder point is computed by multiplying the service standard by the order lead time.
a.
True
b.
False
233. The reorder point can be calculated by multiplying the usage rate by the order lead time and then adding in the
number of safety stock.
a.
True
b.
False
234. Materials handling is important in efficient warehouse operations but has little to do with customers' ultimate
satisfaction with a product.
a.
True
b.
False
235. Unit loading is grouping one or more boxes on a skid.
a.
True
b.
False
236. Warehousing involves designing and operating facilities to store and move goods.
a.
True
b.
False
237. Private warehouses are usually leased or purchased when a firm believes its warehouse needs are so stable that it can
make a long-term commitment to fixed facilities.
a.
True
b.
False
238. Public warehouses are business organizations whose primary activity is providing storage and related physical
distribution facilities on a rental basis to government organizations.
a.
True
b.
False
239. Public warehouses do not furnish security for products being used as collateral for loans.
a.
True
b.
False
240. Bonded storage means that goods will not be released until U.S. customs duties or federal or state taxes or other fees
are paid.
a.
True
b.
False
241. Transportation is the least expensive physical distribution function.
a.
True
b.
False
242. Product availability is dependent on transportation functions.
a.
True
b.
False
243. On-time deliveries may give a firm a competitive edge.
a.
True
b.
False
244. Pipelines are not one of the major transportation modes for moving goods between cities in the United States.
a.
True
b.
False
245. Rail transportation is the fastest yet most expensive form of shipping.
a.
True
b.
False
246. Cost, speed, load flexibility, dependability, frequency, and accessibility are considered when choosing a
transportation mode.
a.
True
b.
False
247. The use of a freight forwarder that consolidates shipments from several organizations into efficient lot sizes usually
increases transit time and sometimes raises shipping costs.
a.
True
b.
False
248. Because costs for small shipments (under 500 pounds) are sharply higher than costs for full loads in railroad cars and
trucks, firms share costs and services by consolidating shipments.
a.
True
b.
False
249. Freight forwarders are companies that offer several shipment methods, including rail, truck, and air service.
a.
True
b.
False
250. A producer that sells similar products through different channels under different brand names is engaging in dual
distribution.
a.
True
b.
False
251. A manufacturer may try to prohibit intermediaries from selling its products outside designated sales territories to
tighten control over distribution of its products.
a.
True
b.
False
252. Full-line forcing requires that channel members purchase the supplier's entire line to obtain any of the products.
a.
True
b.
False
253. Exclusive dealing occurs when a supplier stipulates that a channel member must purchase additional products besides
the one it wants.
a.
True
b.
False
254. Refusal-to-deal arrangements involve a manufacturer that forbids an intermediary to carry products of competing
manufacturers.
a.
True
b.
False
255. You are the head of supply-chain management at a large manufacturing company in the Midwestern United States.
You just returned from a series of workshops on how technology is being deployed by different companies around the
world to improve their supply-chain management activities. You are excited about the prospect of increasing the use of
technology in your firm. Which one of the following reasons would you use to convince your firm’s CEO to invest more
money in technology for supply-chain management?
a.
It will eliminate product defects in the manufacturing process.
b.
It will eliminate errors in financial reporting in the accounting department.
c.
It will significantly reduce marketing costs.
d.
It will increase the sales force’s success rate in winning new customers.
e.
It will create a more effective process for matching inventory needs to manufacturing requirements.
256. You are meeting with the new CEO of your company to discuss marketing channel strategies. You are delighted to
learn that the CEO actually understands the importance of marketing channels in a firm’s sales success. The CEO tells
you that his primary concern is that the chosen marketing channel facilitates the firm’s ability to make products available
when customers want them, and in locations where they want them. He leaves it to you to decide on the appropriate
marketing channel. Given his primary concern you should make sure the channel you choose is capable of creating lots of
_______________.
a.
time and possession utility
b.
place and feature utility
c.
time and place utility
d.
form and possession utility
e.
feature and time utility
257. Your firm is launching a new product that everyone believes is going to be a blockbuster. Everyone is geared up to
make this product launch the most successful in the firm’s history. Your boss instructs you to make sure the product gets
the highest intensity of market coverage the firm can support. To achieve this, you will implement which of the following
distribution strategies?
a.
Intensive distribution
b.
Comprehensive distribution
c.
Selective distribution
d.
Exclusive distribution
e.
Progressive distribution
258. You have spent the last twenty years of your career in various marketing channel management roles with a variety of
companies. One of things you have learned is that channel conflict can be very destructive to all members of the
marketing channel. Which of the following actions would you take to ensure that channel conflict does not occur in your
current role?
a.
Encourage each member of the channel to act in its self-interest.
b.
Make sure the channel handles a diversified set of competing products.
c.
Minimize the level of communication amongst members of the channel so conflicts do not get started.
d.
Establish clearly-defined roles and responsibilities for each member of the channel.
e.
Maintain loosely-defined roles and responsibilities for each member of the channel so each feels like they have
some independent decision-making ability.
259. The supply chain begins with______________ and ends with_________________.
a.
employees, products
b.
marketing, sales
c.
production, inventory
d.
strategy, implementation
e.
raw materials, customers
260. Having products available when customers want them creates _________________.
a.
possession utility
b.
place utility
c.
time utility
d.
form utility
e.
feature utility
261. Exclusive distribution:
a.
is suitable for products consumed over a long period of time.
b.
is desirable when a special effort is important.
c.
is appropriate for convenience products.
d.
is not suitable for infrequently purchased products.
e.
is appropriate for shopping products.
262. In a corporate VMS,
a.
customers are excluded.
b.
marketing channel members are linked by legal agreements.
c.
marketing channel members are independent.
d.
all stages of the marketing channel are combined.
e.
there is dual ownership among channel members.
263. _______________ involves developing and maintaining adequate assortments of products to meet customers’ needs.
a.
Inventory management
b.
Materials handling
c.
Warehousing
d.
Order management
e.
Logistics
264. Supplier ABC requires all its channel members to purchase all of its products in order to be able to purchase any of
its products. This is an example of ____________________.
a.
a tying agreement
b.
a buying agreement
c.
channel stuffing
d.
exclusive dealing
e.
full-line forcing
