Chap 10

Question 1

Place:

Answer 1

Making goods and services available in the right quantities and locations, when the customers want them.

Question 2

Channel of distribution:

Answer 2

Any series of firms or individuals who participate in the flow of products from producer to final user or consumer.

Question 3

Place decisions have long-run effects:

Answer 3

They are usually harder to change than product, price decisions and promotion.

Question 4

Direct distribution:

Answer 4

When a firm distribute directly to the final customer or consumer. Direct distribution allows a firm to control the marketing mix and they can serve target customers at a lower cost or do the work more effectively than intermediaries.

Question 5

Direct marketing:

Answer 5

Direct communication between a seller and an individual customer using a promotion method other than face-to-face personal selling.

Question 6

Discrepancy of quantity:

Answer 6

The difference between the quantity of products it is economical for a producer to make and the quantity the final users or consumers normally want.

Question 7

Discrepancy of assortment:

Answer 7

The difference between the lines a typical producer makes and the assortment a final consumers or users want.

Question 8

Regrouping activities:

Answer 8

Adjust the quantities or assortments of products handled at each level in a channel of distribution.

Question 9

Accumulating:

Answer 9

Involves collecting products from many small producers.

Question 10

Bulk-breaking:

Answer 10

Involves dividing larger quantities into smaller quantities, as products get closer to the final market.

Question 11

Sorting:

Answer 11

Separating products into grades an qualities desired by different target markets.

Question 12

Assorting:

Answer 12

Putting together a variety of products to give a target market what it wants.

Question 13

Traditional channel systems:

Answer 13

The various channel members make little or no effort to cooperate with each other.

Question 14

Vertical conflicts:

Answer 14

Occur between firms at different levels in the channel of distribution.

Question 15

Horizontal conflicts:

Answer 15

Occur between firms at the same level in the channel of distribution.

Question 16

Channel captain:

Answer 16

A manager who helps direct activities of a whole channel and tries to avoid or solve channel conflicts.

Question 17

Vertical marketing systems:

Answer 17

Are channel systems in which the whole channel focuses on the same target market at the end of the channel. These systems make sense and are growing because if the final customer doesn’t buy the product the whole channel suffers.

Question 18

Corporate channel systems:

Answer 18

Corporate ownership all along the channel.

Question 19

Vertical integration:

Answer 19

Acquiring firms at different levels of channel activity.

Question 20

Administered channel systems:

Answer 20

The channel members informally agree to cooperate with each other.

Question 21

Contractual channel systems:

Answer 21

The channel members agree by contract to cooperate with each other.

Question 22

Ideal market exposure:

Answer 22

Makes a product available widely enough to satisfy target customers’ needs but not exceed them.

Question 23

Intensive distribution:

Answer 23

Selling a product through all responsible and suitable wholesalers or retailers who will stock or sell the product.

Question 24

Selective distribution:

Answer 24

Selling through only those intermediaries who will give the product special attention.

Question 25

Exclusive distribution:

Answer 25

Selling through only one intermediary in a particular geographic area.

Question 26

80/20 rule:

Answer 26

80 percent of a company’s sales often come from only 20 percent of its customers until it becomes more selective in choosing customers.

Question 27

Multichannel distribution:

Answer 27

Occurs when a producer uses several competing channels to reach the same target market.

Question 28

Reverse channels:

Answer 28

Channels use to retrieve products that customers no longer want. This occurs when companies have to recall products because of safety problems.

Question 29

Exporting:

Answer 29

Selling some of what the firm produces to foreign markets.

Question 30

Licensing:

Answer 30

Means selling the right to use some process, trademark, patent or other right for a fee or royalty.

Question 31

Management contracting:

Answer 31

The seller provides only management and marketing skills; others own the production and distribution facilities.

Question 32

Joint venture:

Answer 32

A domestic firm enters into a partnership with a foreign firm.

Question 33

Direct investment:

Answer 33

Means that a parent firm has a division or owns a subsidiary firm in a foreign market.