| 1. | _____ Another term for marketing intermediary is channel of distribution. |
| 2. | _____ A function of marketing intermediaries is to create possession, time, and place utility. |
| 3. | _____ In general, channels of distribution for consumer products are longer than for industrial products. |
| 4. | _____ A vertical marketing system (VMS) relies on independently managed marketing intermediaries. |
| 5. | _____ The term “market coverage” refers to the number of intermediaries between a producer and a specific target market. |
| 6. | _____ A manufacturer seeking maximum control over the distribution of its product would choose a corporate VMS over a contractual VMS or an administered VMS. |
| 7. | _____ Merchant wholesalers make up about 60 percent of all wholesalers. |
| 8. | _____ One of the functions of a wholesaler is to assume part of the customer’s risk. |
| 9. | _____ Compared to most retailers, the department store carries a relatively narrow range of products. |
| 10. | _____ Hypermarkets require customers to pay membership fees. |
| 11. | _____ Store location is not a problem for retailers who use intensive distribution to cover the market. |
| 12. | _____ A store’s layout is part of its atmosphere. |
| 13. | _____ The wheel of retailing model predicts an inevitable cycle of failure for all retail businesses that enter the market as low-price, low-cost, low-status stores. |
| 14. | _____ Pipelines transport the narrowest range of products. |
| 15. | _____ The primary goal of inventory management is to minimize the cost of holding stocks of unsold product. |
3. Focus on essential details choosing the right alternatives (a, b, c or d) for each of the 15 sentences below. There is definitely one best answer.
| 1. | The organizations whose transactions link producer and consumer are called |
| | a) channels of distribution. b) wholesalers. | c) marketing intermediaries. d) middle-men. |
| | | |
| 2. | Most marketing intermediaries fall into which of the following categories? |
| | a) producers and retailers b) agents and brokers | c) wholesalers and retailers d) producers and wholesalers |
| | | |
| 3. | Marketing intermediaries are necessary because |
| | a) consumers do not trust producers. b) for the most part, it is inefficient for producers to sell directly to consumers. c) they have many years experience delivering utility. d) they eliminate many of the money-losing intermediate stages in the distribution process. |
| | | |
| 4. | In a __________, marketing intermediaries are linked through binding legal agreements. |
| | a) contractual VMS b) administered VMS | c) limited VMS d) corporate VMS |
| | | |
| 5. | Which of the following usually operate under a contractual VMS? |
| | a) supermarket chains b) professional partnerships | c) services d) franchises |
| | | |
| 6. | Compact disks, microwave ovens, and convertible sofas are distributed at what level of market coverage? |
| | a) exclusive distribution b) selective distribution | c) intensive distribution d) administered distribution |
| | | |
| 7. | Approximately _____ percent of all products are handled by wholesalers. |
| | a) 15 b) 25 | c) 40 d) 60 |
| | | |
| 8. | All of the following statements about wholesalers are true except |
| | a) retailers have direct contact with producers through wholesalers. b) wholesalers deliver utility to customers that producers might be unable or unwilling to provide. c) wholesaling is a growing component of distribution. d) wholesalers absorb inventory costs for manufacturers. |
| | | |
| 9. | Sending catalogs to potential customers is a form of |
| | a) direct marketing. b) in-home selling. | c) convenience selling. d) warehouse selling. |
| | | |
| 10. | Which of the following stores would most likely rely on competition? |
| | a) department stores. b) convenience stores. | c) discount stores. d) specialty stores. |
| | | |
| 11. | Elements of a store’s atmosphere would include all but which of the following? |
| | a) the level of lighting b) how merchandise is displayed | c) the product mix d) the width of the aisles |
| | | |
| 12. | An example of a planned shopping center is a |
| | a) catalog showroom. b) hyperstore. | c) mall. d) warehouse club. |
| | | |
| 13. | The wheel of retailing suggests that a retail business’s long-term success can be threatened by |
| | a) higher operating costs. b) technological advanced. c) scrambled merchandising. d) adding low status merchandise to its product mix. |
| | | |
| 14. | __________ transportation accounts for the majority of dollars spent on transporting products in the U.S. |
| | a) rail b) pipeline | c) air d) truck |
| | | |
| 15. | Setting service standards helps a distributor do all but which of the following? |
| | a) meet customer expectations b) beat the competition c) offer fewer services to customers d) meet performance goals for delivering goods to customers |
