Question 1

In the Mercedes dealer network, individual dealers are given the sole right to sell Mercedes vehicles within a defined geographic area. What type of distribution does Mercedes employ?

Accepted Answer

A)   exclusive distribution
B)   intensive distribution
C)   selective distribution
D)   limited distribution
E)   prestige-based distribution A

Question 2

Compare and contrast the traditional use of power in a marketing channel versus today's notion of integrated and collaborative supply chains. Do the five traditional power bases still play a role in today's era of collaboration? Explain.

Accepted Answer

Power can be defined as the influence that one channel member has over others in the supply chain. Powerful channel members have the ability to get other firms to do things that they otherwise would not do. Depending on how the channel member uses its influence, power can create considerable conflict, or it can make the entire supply chain operate more smoothly and effectively. There are five basic sources of power in a supply chain: 
$ \ddot{\mathrm{Y}} $ Legitimate Power - This power source has to do with the firm's position in the supply chain. 
$ \ddot{\mathrm{Y}} $ Reward Power - The ability to help other parties reach their goals and objectives is the crux of reward power. 
$ \ddot{\mathrm{Y}} $Coercive Power - In contrast to reward power, coercive power is the ability to take positive outcomes away from other channel members or the ability to inflict punishment on other channel members. $ \ddot{\mathrm{Y}} $ Information Power - Having and sharing knowledge is the root of information power. Such knowledge makes channel members more effective and efficient. 
$ \ddot{\mathrm{Y}} $ Referent Power - Referent power has its basis in personal relationships and the fact that one party likes another party. The sources of power or influence change as a supply chain moves toward integration and collaboration. Traditional marketing channels have made heavy use of legitimate, reward, and coercive power sources. The use of these types of power is consistent with the high level of conflict that exists in such channels. Firms want to sell a product for as much as possible, provide as few additional services as it can get away with, obtain payment in advance, and deliver the product at its own convenience. By contrast, buyers want to purchase a product for as little as possible, get a large number of additional services both now and in the future, pay months or even years later with no interest, and get immediate delivery. Collaborative supply chains focus on win-win outcomes and work to get past these natural sources of confrontation. Here, reward and referent power become used most frequently, with the most important source of influence being information. Successfully confronting the problems that naturally materialize in a supply chain depends on the effective development, communication, and utilization of information.

Question 3

What is considered to be the most important factor to successful supply chain management in today's economy?

Accepted Answer

A)   channel integration
B)   cost control
C)   profit maximization
D)   channel effectiveness
E)   category management A

Question 4

Ensuring the availability of products in the right place in the right quantities at the right time in a cost efficient manner is the main focus of:

Accepted Answer

A)   physical distribution.
B)   marketing networks.
C)   supply chain management.
D)   channel management.
E)   network management.

Question 5

Recently, a major manufacturer of small kitchen appliances implemented a program whereby retailers could purchase the firm's popular coffee makers and blenders, but only if the retailers agreed to purchase its less popular irons and food processors. Many of the retailers became angry and threatened to sue the manufacturer for forcing them into a(n):

Accepted Answer

A)   exclusive channel arrangement.
B)   channel stuffing arrangement.
C)   dual distribution agreement.
D)   tying arrangement.
E)   restricted supply agreement.

Question 6

Because the company was angered by the actions of its resellers, Acme Manufacturing decided to slow down deliveries and postpone product availability to these resellers. What type of power is Acme wielding?

Accepted Answer

A)   legitimate power
B)   coercive power
C)   referent power
D)   reward power
E)   logistical power

Question 7

In most marketing channels for consumer products, the balance of power has shifted to _____ due to their size and control over information.

Accepted Answer

A)   consumers
B)   mass merchandise retailers
C)   wholesalers
D)   brokers and distributors
E)   manufacturers

Question 8

Identify and discuss the three major structural options for distribution. In your answer, identify the major advantages and disadvantages of each option.

Accepted Answer

The answer of Identify and discuss the three major structural...

Question 9

Many products, such as candy, soft drinks, and gum are sold via intensive distribution. However, this strategy has a major drawback. What is it?

Accepted Answer

A)   It maximizes profit margin rather than sales volume.
B)   It encourages customers to shop around for the lowest price.
C)   It promotes a very high degree of brand switching.
D)   The manufacturer must give up a good degree of control over pricing and product display.
E)   It gives customers fewer opportunities to find the product.

Question 10

Today, though cutting expenses is still a main factor, the desire of many firms to focus on core competencies is a driving force behind the increase in:

Accepted Answer

A)   category management.
B)   channel integration.
C)   referent power.
D)   product differentiation.
E)   outsourcing.

Question 11

A _____ is an organized system of marketing institutions through which products, resources, information, funds and/or product ownership flow from the point of production to the final user.

Accepted Answer

A)   marketing network
B)   distribution hub
C)   supply chain
D)   marketing channel
E)   product network

Question 12

Which of the following statements best describes a channel that is efficient?

Accepted Answer

A)   A channel that provides maximum time utility
B)   A channel that has eliminated all wholesalers
C)   A channel that provides the best in terms of place utility
D)   An integrated channel that reduces redundancies and waste
E)   All of the above describe efficient channels of distribution.

Question 13

Which member of the marketing channel has the primary responsibility of fulfilling the channel's main functions?

Accepted Answer

A)   manufacturers
B)   wholesalers
C)   retailers
D)   customers
E)   It does not matter.

Question 14

Overall, the trends occurring in marketing channels today (growth in e-commerce, shifting power, outsourcing, growth in direct distribution/nonstore retailing, and growth in dual distribution) have one major theme in common. What is that theme?

Accepted Answer

A)   enhancing the reputation of the supply chain
B)   reducing the risk of legal action in the supply chain
C)   increasing channel efficiency by reducing waste, overhead, and other costs
D)   securing more power and control for manufacturers
E)   All of the above are common themes.

Question 15

In terms of marketing channel functions, which of the following statements describes the concept of discrepancy of quantity?

Accepted Answer

A)   Manufacturers make one or a few product(s) ; customers need variety and assortment.
B)   Channels must make products available in convenient locations.
C)   Channels add value to products by standardizing the exchange process.
D)   Channels must provide for the storage of products for future purchase and use.
E)   Manufacturers produce large quantities; customers usually want only one item.

Question 16

As pressures have increased to cut expenses and increase profit margins, many marketing channels have strongly embraced _____. The rapid increase in nonstore retailing is a prime example of this growing trend.

Accepted Answer

A)   extended enterprise management
B)   channel specialization
C)   category management
D)   outsourcing
E)   direct distribution

Question 17

Discuss the growth and importance of outsourcing in today's economy. What are the driving factors or themes that lead firms to outsource business functions, including channel functions?

Accepted Answer

The answer of Discuss the growth and importance of outsourcing...

Question 18

In some cases, manufacturers can require that wholesalers, brokers, agents, or retailers not carry or represent products from any competing manufacturer. Violations of these restrictions can cause a manufacturer to cut off supply to the intermediary in question. This situation represents which of the following potential ethical or legal issues in supply chain management?

Accepted Answer

A)   exclusive channel arrangements
B)   tying contracts
C)   channel stuffing
D)   dual distribution
E)   restricted supply chains

Question 19

What is the most appropriate type of distribution to use when customers need the opportunity to comparison shop, or when after-sale services are important?

Accepted Answer

A)   exclusive distribution
B)   service-based distribution,
C)   intensive distribution.
D)   comparative distribution,.
E)   selective distribution...

Question 20

Which of the following statements best describes a channel that is effective?

Accepted Answer

A)   A channel that has no redundancies
B)   A channel that provides the best in terms of time, place, and possession utility
C)   An integrated channel that operates at half the cost of competing channels
D)   A tightly integrated channel that operates with little or no waste
E)   A channel that meets the needs of all supply chain partners

Exam 9: Distribution and Supply Chain Management