E3 Ch 15 (slides 11 on)

Question 1

Distribution Center

Answer 1

Facility for the receipt, storage, and redistribution of goods to ANOTHER retailer.

Question 2

Fulfillment Center

Answer 2

Facility shipping goods DIRECTLY to individual consumer.

Question 3

Just in Time Systems

Answer 3

“Quick response inventory systems”

Keeping just enough on hand and replenishing as needed; less merchandise on a more frequent basis

Eg. H&M, Zara, etc. have adopted a QR inventory system

Question 4

Direct Channel

Answer 4

Producer –> Consumer
Ex. Farmer selling his goods at a farmer’s market; selling a product off of your OWN website and shipping it to the buyer yourself

Question 5

Indirect Channel

Answer 5

Producer –> Intermediary (Wholesaler, retailer) –> Consumer

Question 6

Wholesaler

Answer 6

Middle men; buying from a manufacturer and selling to another business
Takes title – they own it
Ex. Restaurant Depot

Question 7

Retailer

Answer 7

Sells to final customers

Question 8

Franchising

Answer 8

Contractural agreement between franchisor and franchisee; operating a retail outlet using a name/format developed by franchisor
Ex. McDonalds

Question 9

Channels Management

Answer 9

Lots of players; vertical conflict (between manufacturer and retailer) and horizontal conflict (retailer vs retailer)
Ex. Vertical: TTI only wants Milwaukee tools on the shelf of Home Depot

Question 10

Push Inventory

Answer 10

Merchandise allocated based on historical sales forecast; good for steady, KNOWN demand items

Question 11

Pull Inventory

Answer 11

Orders based on sales data; more accurate inventory; better when demand is UNKNOWN/product is new
Ex. A new sweet potato pie hits the shelves at Walmart and is pulling sales in

Question 12

Adv of Distrib Center (4)

Answer 12

1. More accurate sales forecasts; many stores serviced by one center
2. Lower inv in each store –> lower inv costs
3. Easier to avoid running out OR having too much
4. Less expensive in an offsite warehouse than an expensive retail location

Question 13

When to skip using distrib centers… (2)

Answer 13

1. If retailer has few outlets and/or stores are consolidated
2. If you’re selling perishable goods or fads

Question 14

Traditional Distrib

Answer 14

Trucks bring merchandise up to sit on the shelves until its ready to be brought out

Question 15

Cross-Docking

Answer 15

Merchandise held for >24 hours. Comes in one door to be sorted before going right back out another door
Ex. Zara’s fast fashion, bread, eggs

Question 16

Getting Merch Floor-Ready: Ticketing and Marking

Answer 16

Firms are forcing suppliers to ship floor ready merchandise. Why spend time and money on having to get merchandise ready in the back when it could be getting sold off the shelves?

Question 17

Driverless delivery vehicles and drones…

Answer 17

…are currently in the experimentation phase

Question 18

The Supply Chain: The Physical Supply Netowrk

Answer 18

Raw materials
Components
MFG

Question 19

The Supply Chain: The Marketing Channel/Demand/Value Chain

Answer 19

MFG
Resellers
Consumers

Question 20

Merchandise is produced and distributed… (3)

Answer 20

In the right quantities
To the right locations
At the right times

Question 21

Wholesalers

Answer 21

Firms that buy products from manufacturers and sell them to retailers

Question 22

Supply Chain Management

Answer 22

Integration of suppliers, manufacturers, warehouses, stores, intermediaries into a seamless operations to get the product in the right place, right time, right price

Question 23

Discrepancy of Quantity

Answer 23

Manufacturer produces in large volume, consumers buy in small volume

Question 24

Discrepancy of Assortment

Answer 24

Manufacturer produces many of one item, consumer buys one of many items

Question 25

Temporal Discrepancy

Answer 25

Difference in when something is produced and when it is purchased

Question 26

Spatial Discrepancy

Answer 26

Difference between where something is produced and where it is purchased