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The physical distribution concept says (or implies) that:
A. transporting, storing, and product-handling are unrelated activities for cost control.
B. the best distribution system is the lowest cost one.
C. a firm should seek to minimize the total cost of transporting, storing, and
product-handling-for a given level of customer service.
D. if the transporting department minimizes its costs and the storing department
minimizes its costs and the product-handling department minimizes its costs-then the
total cost of physical distribution will be minimized.
E. None of these alternatives is correct.
Answer:
Which of the following statements about Place is FALSE?
A. Place variations are required when target markets have different needs.
B. Product classes suggest Place objectives.
C. Place decisions have relatively little impact on competition in a product-market.
D. Place decisions have longer-run implications than Price decisions.
E. Place decisions need to consider when customers want products.
Answer:
Use the following information to answer question that refer to the Jewel Craft case.
Jewel Craft, Inc. is a leading producer in the United States' women's costume jewelry
and accessories market. Its brands are well known and are sold by department stores
and better women's stores. Several stores in a city may carry Jewel Craft's brands
because most of Jewel Craft's customers will not consider any other brand.
Jewel Craft's sales force calls on one wholesaler in each state. Gemco, Inc., of Boston,
Massachusetts, is the Jewel Craft distributor in that state. Gemco stocks and sells
women's accessories (noncompeting lines) for several manufacturers like Jewel Craft.
Wholesalers are allowed a 20 percent markup by Jewel Craft-but pay the freight
charges to their warehouses. Jewel Craft's policy of using one wholesaler per state
comes from its desire to control its distribution. Jewel Craft uses national magazine
advertising and also supports a cooperative ad program with retailers.
Jewel Craft's prices allow for a 40 percent retail markup-an attractive percent when one
considers that Jewel Craft's products require little in-store selling because of their
well-established reputation.
Recently, Jewel Craft was approached by a watch producer with the idea of expanding
to watches under the Jewel Craft name. It was argued that although national watch sales
have leveled off, Jewel Craft could enjoy growing sales for several years because of the
fine reputation the company has achieved. If watches are added, Jewel Craft will use its
present policies regarding distribution, pricing, and advertising. Further, it will offer the
wholesalers and retailers an attractive "package" deal as an incentive to carry Jewel
Craft watches. Intermediaries will be required to carry the watches if they wish to
handle the jewelry and accessories.
A sales invoice sent by Jewel Craft to Gemco is MOST LIKELY to include the
following item:
A. F.O.B. buyer's warehouse
B. F.O.B. seller's factory-freight prepaid
C. F.O.B. seller's factory
D. F.O.B. delivered
Answer:
If a firm offers a written warranty, it
A. must be labeled either "full" or "limited."
B. must be available to buyers before the sale.
C. shouldn't be "deceptive" or "unfair" per FTC guidelines.
D. may help create a new strategy.
E. All of these alternatives are correct.
Answer:
"Soak" is a retailer with two locations in a major metropolitan area, both of which are in
large, popular shopping centers. It carries a unique assortment of high-quality shower
and bath products, such as soaps, bubble bath, and bath oils. One of its most popular
products is a "bath bomb"-a round ball that fizzes and releases aromatic bath oils when
placed in a bathtub filled with warm water. The small staff at the store is very
knowledgeable about the store's products and provides a high level of customer service.
"Soak" would be classified as a:
A. convenience store.
B. department store.
C. discount house.
D. specialty shop.
E. general store.
Answer:
Which of the following is a characteristic of owned media?
A. It is relatively more expensive when compared to earned media.
B. It is typically characterized by high message control.
C. It is a more trusted information source than earned media.
D. It cannot be used to target niche audiences.
E. It lacks versatility in message content and format.
Answer:
A grocery store chain has decided to sell a small assortment of fast moving auto repair
items-but is not certain what stock to carry in which stores and does not want to leave
the decision to the local store manager. The chain should probably get help from a
A. broker.
B. cash-and-carry wholesaler.
C. specialty wholesaler.
D. rack jobber.
E. manufacturers' agent.
Answer:
Which of the following is an example of inbound communication with a customer
seeking new hiking boots? (Timberland is a brand of hiking boots)
A. A searches for and then visits the website of a Timberland to read about boots.
B. The customer receives a mailing that features Timberland boots from a local shoe
store.
C. Timberland runs television ads on its new boots.
D. The customer reads Timberland's CEO Twitter messages.
E. The customer goes into a store selling Timberland boots.
Answer:
Paul Osborne is an agent for a major insurance company. He is responsible for building
his own network of clients who purchase insurance policies and other financial services
from him. He schedules appointments with prospective clients, makes sales
presentations, and provides policy service after the sale. Paul is a(n)?
A. Order taker.
B. Order getter.
C. Supporting salesperson.
D. Sales technician.
E. Sales manager.
Answer:
_____ is a person's point of view toward a product, an advertisement, a salesperson, a
firm, or an idea.
A. An attitude
B. A belief
C. A preference
D. An impression
E. A cue
Answer:
Use this information for question that refer to the Centerville Retailers and Wholesalers
case.
Carol Lamb has lived in Centerville all her life. She owns a retail store that sells hobby
and craft supplies. She bought the store after working there for 7 years. Carol has just
been asked to head up the Retailers and Wholesaler Group of the Centerville Chamber
of Commerce. The most active chamber members in her group are described below:
Walden's Leather is part of a regional chain of stores that sells leather goods-mostly
men's and women's clothing-with the upscale Walden's brand name. Walden's primarily
relies on its own stores where knowledgeable salespeople offer great service. Walden
products are also sold, on a limited basis, in some fine department stores.
Publisher's Helper is a small business started by Audrey Yang that provides and stocks
display racks for paperback books and magazines. Most retailers welcome the service
Audrey provides, in part because she does her own research to determine which
paperback books and magazines sell best in Centerville.
Cuzco's is Centerville's alternative to Walmart. The store sells a wide variety of
merchandise. The company used to concentrate its product mix on small appliances-but
now Cuzco's carries any product that it can sell profitably. Its low prices stimulate faster
turnovers and higher sales volumes.
Games Unlimited sells video games. Jamie Carraway, who owns the local store, signed
a contract with Games Unlimited and follows strict rules covering her store's operations
and the Games Unlimited marketing strategy. She pays that company a fee for
promotion it provides as well as commissions on her sales.
Johnson's Health and Beauty Supplies sells cosmetics and other health and beauty
products to retailers and salons throughout the greater Centerville area. It owns the
goods it sells to these retailer customers, and it provides all the wholesaling functions
they need.
Valu Grocer is an independent grocery store that belongs to an organization sponsored
by a large food wholesaler. The fifty stores grocery stores that share the Valu Grocer
name are linked by contracts that include basic operating procedures, storefront designs,
and joint promotion efforts.
Reddy and Sons sells equipment for several different manufacturers of plastic molding
in the Centerville area. It earns a commission from each manufacturer on the products it
sells for that manufacturer, but it does not take ownership of the equipment it sells nor
does it install the equipment.
Katrina's Salon started out as a low-status, low-price, low-margin hair salon 15 years
ago. After some success, the company moved into a nicer storefront, raised prices, and
now operates in the middle of the market.
Which of these businesses best fits the definition of a limited-line store?
A. Johnson's Health and Beauty Supplies
B. Valu Grocer
C. Cuzco's
D. Walden's Leather
Answer:
Tropicana is trying to get its customers to drink orange juice more often with ads that
say, "It's not just for breakfast anymore." What type of opportunity is the company
pursuing?
A. Market penetration
B. Diversification
C. Market development
D. Product development
E. Mass marketing
Answer:
Which of the following is NOT a key dimension of buyer-seller relationships in
business markets?
A. legal bonds
B. relationship-specific adaptations
C. joint inspection
D. operational linkages
E. information sharing
Answer:
In the U.S. by 2015, Internet retailing is expected to total just over ________ billion-not
counting travel and other services.
A. $25
B. $80
C. $150
D. $300
E. $750
Answer:
Regarding the size of manufacturing concerns, large firms (with more than 250
employees)
A. outnumber small firms more than two to one.
B. account for nearly half of all the manufacturing establishments.
C. are few in number but their employees account for about 44 percent of production
workers.
D. provide no more "value added" than the many small firms.
E. None of these alternatives is true.
Answer:
Which of the following buying situations gives a seller the most chance for promotion
impact?
A. Selective task buying
B. Modified rebuy buying
C. New-task buying
D. Straight rebuy buying
E. All of these buying situations are equal.
Answer:
Customer value typically would NOT be impacted by a marketing manager's decisions
concerning:
A. product.
B. place.
C. promotion.
D. price.
E. Any of these might impact customer value.
Answer:
When using __________, researchers compare the responses of two or more groups that
are similar except on the characteristic being tested.
A. response rates
B. consumer panels
C. experimental method
D. personal interview surveys
E. opinion leader analysis
Answer:
A marketing manager developing a marketing mix to sell ______ probably needs to be
concerned with grading, transportation, and storing because of seasonal production
and/or perishable products.
A. component parts
B. accessories
C. impulse
D. supplies
E. raw materials
Answer:
"Don't-rock-the-boat" thinking is most common when
A. a product is in the introduction stage.
B. the total market is not growing.
C. there is threat of intense competition.
D. a firm moves into international markets for the first time.
E. a product is in the growth stage.
Answer:
Which of the following statements about customer service is true?
A. A customer service rep may have to deal with a customer problem that is due to a
customer error, not just an error by the company.
B. Customer service is the service part of the benefit that a customer gets when
purchasing a physical good.
C. Customer service costs are likely to decrease a firm's customer equity.
D. Customer service is more important for winning customers than for keeping
customers.
E. From a firm's perspective, customer service is a necessary evil but isn't likely to cost
the firm anything.
Answer:
Which of the following retailers spend more on advertising as a percent of sales?
A. Furniture stores
B. Eating Places
C. Women's clothing stores
D. Grocery stores
E. Hotels and motels
Answer:
When Walgreens Drugstore advertises one price for the cost of a roll of film and the
cost of processing it, it is using
A. complementary product pricing.
B. flexible pricing.
C. product-bundle pricing.
D. a one-price policy.
E. bait pricing.
Answer:
Regarding sales force compensation, the commission method is based on:
A. a percentage of dollar sales.
B. the number of new accounts.
C. customer satisfaction ratings.
D. customer service problems resolved.
E. any of these alternatives could be used with the commission method.
Answer:
Use this information for question that refer to the Wire Products Inc. (WPI) case.
Rob Rose sat back to review the portfolio of products his company, Wire Products Inc.
(WPI), has in its product line. The company specializes in making various products for
consumer and industrial uses from hard laminated wire-coated with special paints.
1) WPI's "Wire Closet" products have been on the market for 10 years. Consumers
install the wire shelves and closet rods themselves. The market leader, Closetmaid, has
been selling similar products for more than 20 years, but so far the sales volume and
profits for the market continue to grow. Recently, several new competitors have come
into the market.
2) Three months ago, WPI entered the lawn and garden market with folding fences
made with laminated wire and branded as "Wire Fold-Fence." Previously, WPI had
never made fences or been a player in the lawn and garden market-although other
companies have been making products in this market for years. However, Rob Rose has
discovered that recent sales of wire garden fencing have leveled off and profits are
declining overall. Still, WPI thinks it has some cost advantages and can grow its own
sales and profits in this market.
3) WPI has just developed "Oil Wire," a new concept for the environmental cleanup
market. Oil Wire is coated with a special material that cleans up oil spills. There has
never been a product like this and WPI wants to quickly get the word out about its
benefits. The product is now being rolled out in selective markets.
4) Another business product is "Wire Locker" used for secure storage by gymnasiums
or companies. This style of locker has now gone out of fashion and most customers are
finding better materials to use for lockers. Aggressive selling has helped Wire Locker's
sales stay flat, but the total market for wire style lockers is only half of what it was 10
years ago.
5) WPI's "Wire Window" product is used as a security product to protect glass
windows. It sells to homeowners and retailers looking for additional safety. WPI's sales
of this product have dropped in recent years because competitors have introduced
maintenance-free products. However, the overall market for this type of product
continues to show good growth.
6) WPI is running concept tests of a new wire car-top carrier called "Wire Car Top."
There are other car-top carrier products on the market, but WPI plans to include options
in its carrier that will make it easier to load bikes, skis, and suitcases. "Wire Car Top" is
also very easy to put on and take off of the car because of its light weight and
ease-of-use features. The concept tests are helping WPI analysts develop rough
estimates of costs, sales, and profits.
7) Another new product idea, tentatively called "Wire Tent," is being considered. It
would use laminated wires to create a portable tent frame. This product is currently
being evaluated to determine its fit with the company's objectives and external market
trends.
Rob is thinking about the product life cycle, where each product fits, and what he
should be doing as part of his marketing plan for each of these products.
In which stage of the product life cycle is "Wire Window"?
A. Market maturity
B. Market development
C. Sales decline
D. Market Growth
E. Market introduction
Answer:
A paving contractor wants to work on road construction contracts administered and paid
for by the state government. The contractor submits a sealed proposal to the state
department of transportation for each construction job. The proposal contains a
description of how the contractor will fulfill the specifications for the job at a specified
price. The contractor is engaging in:
A. odd-even pricing.
B. prestige pricing.
C. leader pricing.
D. bid pricing.
E. price lining.
Answer:
"Place" is NOT concerned with:
A. storing.
B. intermediaries.
C. transporting.
D. channels of distribution.
E. sales reps.
Answer:
The trend toward scrambled merchandising can be explained by:
A. the "wheel of retailing" Theory.
B. the fact that cities are getting larger and larger, and it is harder for a retailer to
segment the market.
C. growing consumer demand for more service in retail stores.
D. the fact that some retailers have traditionally used markups which seem "too high" to
other retailers.
E. the growth of in-home shopping.
Answer:
Sony manufactures clock radios in quantities of more than 100,000 in a given time
period-but the average consumer wants only one clock radio at a time. This difference is
an example of
A. a regrouping activities.
B. a discrepancy of assortment.
C. a discrepancy of quantity.
D. a sorting error.
E. re-assorting.
Answer:
Which of the following pricing approaches should be used by a profit-oriented retailer
if its demand curve is down-sloping to the right for a while-but then actually bends back
to the left at lower prices?
A. Psychological pricing
B. Prestige pricing
C. Average-cost pricing
D. Bait pricing
E. Penetration pricing
Answer:
Storing:
A. costs include the costs of damage, theft, and reduced value if products get
out-of-date.
B. costs can be reduced in the channel if suppliers are reliable about meeting delivery
schedules.
C. too few products is likely to reduce a firm's costs, sales, and profits.
D. decisions are more difficult to make when demand is irregular.
E. All of these alternatives about storing are true.
Answer:
