Chapter 11

Question 1

What is Value Delivery network?

Answer 1

The network made up of the company, suppliers, distributors, and ultimately customers who partner with each other to improve the performance of the entire system in delivering customer value.

Question 2

What is marketing channel?

Answer 2

A set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business customer.

Question 3

Which functions can channel partners perform?

Answer 3

Information gathering and distribution
Promotion at point of purchase
Contact
Matching and arranging
Negotiation
Physical distribution
Financing
Risk taking
After-sale support

Question 4

What is retailing?

Answer 4

The business of selling goods or services to consumers for their personal use.

Question 5

Who is a retailer?

Answer 5

A business that primarily sells products and services to consumers.

Question 6

What is wholesaling?

Answer 6

All activities involved in selling goods and services to those buying for resale or business use.

Question 7

Who are wholesalers?

Answer 7

Companies whose primary business is wholesaling.

Question 8

Who is drop shipper?

Answer 8

An intermediary that takes orders and payments from customers then arranges to have the merchandise shipped to the customer directly from the supplier.

Question 9

Who is rack jobber?

Answer 9

A wholesaler that buys merchandise and resells it on “rack” inside the retail store, in partnership with the retailer.

Question 10

Who is a broker?

Answer 10

A wholesaler that does not take title to goods and whose function is to bring buyers and sellers together and assist in negotiation.

Question 11

Who is an agent?

Answer 11

A representative, either of buyer or a seller, who performs only few functions and does not take title to goods.

Question 12

What is channel level?

Answer 12

A layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer.

Question 13

What is direct marketing channel?

Answer 13

A marketing channel that has no intermediary levels.

Question 14

What is indirect marketing channel?

Answer 14

A marketing channel containing one or more intermediary levels.

Question 15

What is vertical marketing system?

Answer 15

A distribution channel structure in which producers, wholesalers, and retailers act as a unified system. One channel member owns the others, has contracts with them, or has so much power that they all cooperate.

Question 16

What is corporate VMS?

Answer 16

A vertical markeing system that combines successive stages of production and distribution under single ownership; channel leadership is established through common ownership.

Question 17

What is administered VMS?

Answer 17

A vertical marketing system that coordinates successive stages of production and distribution, not through common ownership or contractual ties, but through the size and power of the parties.

Question 18

What is contractual VMS?

Answer 18

A vertical marketing system in which independent firms at different levels of production and distribution work together under contract.

Question 19

What is franchise organization?

Answer 19

A marketing system that links several stages in the production and distribution process, and controls operations from a central head office.

Question 20

What is franchise organization?

Answer 20

A marketing system that links several stages in the production and distribution process, and controls operations from central head office.

Question 21

What is horizontal marketing system?

Answer 21

An arrangement in which two or more companies that operate at the same channel level join together to follow a new marketing opportunity.

Question 22

What is multichannel (hybrid) distribution system?

Answer 22

A distribution system in which a single firm sets up two or more marketing channels to reach one or more market segments.

Question 23

What is channel conflict?

Answer 23

Disagreement among marketing channel members over goals, roles, and rewards.

Question 24

What is disintermediation?

Answer 24

The cutting out of marketing channel intermediaries by product or service producers or the displacement of traditional resselrs by radical new types of intermediaries.

Question 25

What is intensive distribution?

Answer 25

A marketing strategy in which the product is stocked in as many outlets as possible.

Question 26

What is selective distribution?

Answer 26

A distribution strategy in which the market selects a set of retailers that specialize in their product category.

Question 27

What is exclusive distribution?

Answer 27

A distribution strategy in which the marketer gives the rights to distribute its products to only one retailer in a particular geographic territory.

Question 28

What is marketing channel design?

Answer 28

Designing effective marketing channels by analyzing customer needs, setting channel objectives, determining the types and responsibilities of channel members, and making decisions about international distribution channels.

Question 29

What is logistics management (supply chain management)?

Answer 29

Planning, implementing and controlling the physical flow of materials, final goods, and related information from points of origin to point of consumption to meet customer requirements at a profit.

Question 30

What are just-in-time logistics systems?

Answer 30

A type of inventory management system in which only small inventories of parts or merchandise are held, and new stock arrives “just in time” when it is needed.

Question 31

What is multimodal (or intermodal) transportation?

Answer 31

Combining two or more modes of transportation.

Question 32

What is third-party logistics (3PL) provider

Answer 32

An independent logistics provider that performs any or all of the functions required to get its client’s product to market.