Chapter 15

Question 1

decisions and activities that make products available to customers when and where they want to purchase them

Answer 1

distribution

Question 2

all the activities associated with the flow and transformation of products from raw materials through to the end customer

Answer 2

supply chain

Question 3

total set of managerial activities used by an organization to transform resource inputs into products

Answer 3

operations management

Question 4

planning, implementing, and controlling the efficient and effective flow and storage of products and information from the point of origin to consumption to meet customers’ needs and wants

Answer 4

logistics management

Question 5

in its broadest form, regers to the processes that enable the progress value from raw material to final customer and back to redesign and final disposition

Answer 5

supply management

Question 6

set of approaches used to integrate the functions of operations management, logistics management, supply management, and marketing channel management so products are produced and distributed in the right quantities, to the right locations, and at the right time

Answer 6

supply-chain management

Question 7

technology is a supply chain management issue

Answer 7

• information technology has created almost seamless distribution processes
• information sharing has reduced costs
• increased speed, flexibility, and cooperation

Question 8

a group of individuals and organizations that direct the flow of products from producers to customers within the supply chain

Answer 8

marketing channel

Question 9

middlemen that link producers to other intermediaries or ultimate consumers through contractual arrangement or through the purchase and reselling of products

Answer 9

marketing intermediaries

Question 10

marketing activities performed by channel members

Answer 10

• marketing information
• marketing management
• facilitating exchanges
• promotion
• price
• physical distribution

Question 11

why marketing channels are significant

Answer 11

• marketing channel decisions influence the rest of the marketing mix
• Channel decisions determine:
• -a products market presence
• -buyer’s accessibility to the product
• effective marketing channels required for organizational success
• entail long term commitments among variety of firms
• -difficult to change/undo marketing channel decisions

Question 12

having products available when the customer wants them (movies on demand)

Answer 12

time utility

Question 13

created by making products available in locations where customers wish to purchase them (sock vending machine at bowling alley)

Answer 13

place utility

Question 14

the customer has access to the product to use or to store for future use (ownership)

Answer 14

possession utility

Question 15

assembling, preparing, or otherwise refining the product to suit individual customer needs

Answer 15

form utility

Question 16

an independent business that takes title to products and carries inventories

• usually sells standardized items, although some carry a wide variety of items
• cost effective when a product has a broad market appeal, is easily stocked and services, is sold in small quantities and is needed on demand

Answer 16

industrial distributor

Question 17

independent businessperson who sells complementary products of several producers in assigned territories and is compensated through commissions

Answer 17

manufacturers’ agent

Question 18

the use of two or more marketing channels to distribute the same products to the same target market

Answer 18

dual distribution

Question 19

an agreement whereby products of one organization are distributed through the marketing channels of another

Answer 19

strategic channel alliance

Question 20

components to selecting marketing channels:

Answer 20

• customer characteristics
• product attributes
• type of organization
• competition
• environmental forces
• characteristics of intermedediaries

Question 21

using all available outlets to distribute a product (convenience products such as coke, pringles)

Answer 21

intensive distribution

Question 22

using only some available outlets in an area to distribute a product (shopping products–iPods, televisions)

Answer 22

selective distribution

Question 23

using a single outlet in a fairly large geographic area to distribute a product (specialty products–haute couture, BMWs)

Answer 23

exclusive distribution

Question 24

dominant leader of a marketing channel or supply channel

Answer 24

channel captain

Question 25

ability of one channel member to influence another member's goal achievement

Answer 25

channel power

Question 26

- enables retailers, wholesalers, suppliers, and logistics providers to: - --speed up inventory replenishment - --improve customer service - --cut the costs of bringing products to cus - a marketing channel should be viewed as a unified supply chain - members should work toward common objectives - channel member tasks must be clearly defined

Answer 26

channel cooperation

Question 27

_____________occurs when: - self-interest creates misunderstanding about role expectations of channel members - communication is poor between channel members - there is increased use of multiple channels has increased the chance for miscommunication and conflict

Answer 27

channel conflicts

Question 28

combines 2 or more stages of the marketing channel under one management

Answer 28

vertical integration

Question 29

marketing channel managed by a single channel member to achieve efficient, low-cost distribution aimed at satisfying target market customers (corporate, administered, contractual)

Answer 29

vertical marketing systems

Question 30

- combining organizations at the same level of operation under one management - creates economies of scale - not the best method for improving distrbution

Answer 30

horizontal channel integration

Question 31

activities used to move products from producers to consumers and other end users

Answer 31

physical distribution

Question 32

the contracting of physical distribution tasks to third parties

Answer 32

outsourcing

Question 33

the time needed to complete a process

Answer 33

cycle time

Question 34

the receipt and transmission of sales order information

Answer 34

order processing

Question 35

computerized means of integrating order processing with production, inventory, accounting, and transportation

Answer 35

electronic data interchange (EDI)

Question 36

developing and maintaining adequate assortments of products to meet customers' needs

Answer 36

inventory management

Question 37

shortages in products that can result in brand switching, lower sales, loss of customers

Answer 37

stockouts

Question 38

the inventory level that signals the need to place a new order

Answer 38

reorder point

Question 39

the average time lapse between placing the order and receiving it

Answer 39

order lead time

Question 40

rate at which a products inventory is used or sold during a specific time period

Answer 40

usage rate

Question 41

amount of extra inventory a firm keeps to guard against stockouts resulting from above-average usage rates and/or longer-than-expected lead times

Answer 41

safety stock

Question 42

inventory-management approach in which supplies arrive just when needed for production or resale

Answer 42

Just-in-time (JIT)

Question 43

physical handling of tangible goods, supplies, and resources - involves transportation from points of production to points of consumption - efficient materials handling can reduce costs, the number of times a good is handled, improve customer service and increase customer satisfaction - RFID--radio waves used to track materials

Answer 43

material handling

Question 44

one or more boxes are placed on a pallet or skid; these units then can be loaded efficiently by mechanical means such as forklifts, trucks, or conveyer systems

Answer 44

unit loading

Question 45

the consolidation of many items into a single, large container that is sealed at its point of origin and opened at its destination

Answer 45

containerization

Question 46

the design and operation of facilities for storing and moving goods

Answer 46

warehousing

Question 47

company-operated facilities for storing and shipping products

Answer 47

private warehouses

Question 48

storage space and related physical distribution facilities that can be leased by companies

Answer 48

public warehouses

Question 49

runs the risk of being viewed as anti-competitive

Answer 49

dual distribution

Question 50

courts have conflicting opinions on restricted intermediaries to certain sales territories

Answer 50

restricted sales territories

Question 51

a supplier furnishes a product to a channel member with the stipulation that the channel member must purchase other products as well --courts only accept these when the supplier is the only one able to provide products of a certain quality and the intermediary can also carry competing products

Answer 51

tying agreement

Question 52

a manufacturer forbids an intermediary to carry products of competing manufacturers --only considered legal if the deal blocks competitors from less than 15% of the market, the sales volume is small and the producer is smaller than the retailer

Answer 52

exclusive dealing

Question 53

producers have the right to choose channel members

Answer 53

refusal to deal