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Principles of Marketing Ch 13 Supply Chain Management and Marketing Channels

A marketing channel is a business structure composed of interdependent organizations that reach from the point of product origin to the final consumer.
true
As products move through the marketing channel, channel members provide specialization and division of labor, overcome discrepancies, and provide contact efficiency.
true
A consumer stopped by the convenience store to buy a bag of charcoal briquettes. She only needs one bag, but the manufacturer produces millions of bags. For consumers, the convenience store overcomes a discrepancy of dimensions.
false
Residents of Sobarro, New Mexico, live in an isolated area of the state. Residents must travel two hours to receive medical treatment. Luckily, a physician has just opened a new practice in Sobarro. In this case, the physician has overcome service discrepancies by opening an office close to consumers.
false
Consider a scenario in which there are four manufacturers, no intermediaries, and three consumers. Twelve transactions would be required for each consumer to receive products from each manufacturer. The introduction of one intermediary reduces the required number of transactions to four and demonstrates the idea of contact efficiency.
false
A merchant wholesaler is an institution that buys goods from manufacturers and resells them to businesses, government agencies, and other wholesalers or retailers.
true
Carl represents a manufacturer of floor coverings and gets paid a commission for finding buyers and linking them up with the manufacturer. Carl is an example of a merchant wholesaler
false
The three basic functions a channel intermediary provides are transactional, logistical, and facilitating functions.
true
The logistical functions performed by intermediaries include physically distributing, storing, sorting, and financing.
false
Harriet Lowe makes children’s clothing, which she sells at craft festivals to end users. Lowe does not use channel intermediaries, which means she uses a direct channel.
true
The direct channel is used more often in consumer markets than in business-to-business markets.
false
The direct channel is used more often in consumer markets than in business and industrial markets.
false
LoneStar Bar & Grill is a small chain of restaurants that feature marinated steaks. The marinade is so popular that LoneStar sells it at its restaurants and also sells it at Kroger supermarkets. This is an example of intensive distribution.
false
Metallurgical Designs makes gold and silver charms for necklaces and bracelets. It markets its charms to a few retailers in any one region and promotes them intensively to those retailers. This is an example of intensive distribution.
false
Shopping goods are usually distributed selectively. Consumers are willing to look around for them but may not be willing to search or travel extensively to acquire the product.
true
Exclusive distribution is the most extensive form of market coverage.
false
At one end of the channel relationship continuum is the “Arm’s Length” relationship.
true
Highly integrated channel relationships are the preferred relationship because there is no large outlay of assets required to keep the channel members all working toward the same results.
false
Integrated channel relationships tend to be more flexible than cooperative relationships.
false
An international consumer products manufacturer requires all of its suppliers to provide the lowest possible cost and to adhere to a just-in-time inventory system. Wholesalers and manufacturers generally yield to the authority of this large manufacturer. This consumer products manufacturer exercises channel power.
true
Reciprocal conflict occurs among channel members on the same level, such as two or more different wholesalers or two or more different retailers that handle the same manufacturer’s brands.
false
Many regard vertical conflict as healthy competition.
false
Because distribution creates the same problems whether it is in Ethiopia, Indonesia, or Canada, you will find that channel structures and types around the world are very similar to those in the United States.
false
Gray marketing channels assist brand name manufacturers in marketing their products more efficiently.
false
Unlike marketers of physical products, marketers of services do not have to address the question of logistics since services do not require a distribution strategy.
false
When discussing the distribution of services, you will often hear channel members discussing the need to minimize wait times.
true
The Beistle Company manufactures Halloween decorations year-round, but customer demand is con-centrated only during the month of October. By maintaining inventories of the Beistle Company’s products, marketing channels overcome this spatial discrepancy.
false
Transactional functions include contacting potential customers and assuming the risk of owning inventory.
true
Supply chain management is a key means of differentiation for a firm and a critical component in marketing and corporate strategy.
true
As firms become increasingly supply chain oriented, they develop management practices that are consistent with a systems approach.
true
Designing a new product with the help of suppliers and customers can enable a company to introduce features and cost cutting measures into final products.
true
Reactive supply chain resiliency measures seek to protect key inventory and assets from damage, theft, or destruction.
false
It is important to limit the number of supply chain partners in the product development and commercialization process.
false
The customer relationship management process includes customer segmentation by value and subsequent generation of customer loyalty for the most attractive segments.
true
Using three-dimensional printing (3DP) technology, objects are built to precise specifications using raw materials at or near the location where they may be consumed.
true
Fourth-party logistics companies (4PLs) often draw on multiple third-party logistics companies for actual service.
true
New products and services are mostly the sole responsibility of a single firm in the supply chain.
false
In the customer relationship management (CRM) process, once higher-value customers are identified, firms should focus on identifying and attracting other groups by providing them with customized products and better services.
false
The three basic functions channel intermediaries perform are:
a. transactional, logistical, and facilitating
b. contacting, negotiating, and ownership
c. promoting, distributing, and bulk-breaking
d. assorting, accumulating, and allocating
e. financing, mediating, and storing
a. transactional, logistical, and facilitating
Transactional channel functions include all of the following activities EXCEPT:
a. contacting buyers
b. promoting the products to be sold
c. taking the risks associated with product inventories
d. negotiating the sale
e. physical distribution and sorting
e. physical distribution and sorting
The efficient and cost-effective forward and reverse flow and storage of goods, services, and related information into, through, and out of channel member companies is called:
a. systematization
b. logistics
c. engineering
d. distribution
e. coordination
b. logistics
Which of the following is a logistical function performed by intermediaries?
a. Sorting
b. Negotiating
c. Financing
d. Risk taking
e. All of these choices
a. Sorting
Marketing channels perform all of the following logistical activities EXCEPT:
a. sorting
b. storing
c. physically distributing
d. risk taking
e. breaking bulk
d. risk taking
All of the following are sorting activities EXCEPT:
a. assorting
b. accumulation
c. sorting out
d. allocation
e. possession
e. possession
supply chain
the connected chain of all of the business entities, both internal and external to the company, that perform or support the logistics function
supply chain management
a management system that coordinates and integrates all of the activities performed by supply chain members into a seamless process, from the source to the point of consumption, resulting in enhanced customer and economic value
supply chain agility
an operational strategy focused on inducing inventory velocity and operational flexibility simultaneously in the supply chain
supply chain integration
when multiple firms or business functions in a supply chain coordinate their activities and processes so that they are seamlessly linked to one another in an effort to satisfy the customer
demand-supply integration (DSI)
a supply chain operational philosophy focused on integrating the supply-management and demand-generating functions of an organization
business processes
bundles of interconnected activities that stretch across firms in the supply chain
customer relationship management (CRM) process
allows companies to prioritize their marketing focus on different customer groups according to each group’s long-term value to the company or supply chain
customer service management process
presents a multi-company, unified response system to the customer whenever complaints, concerns, questions, or comments are voiced
demand management process
seeks to align supply and demand throughout the supply chain by anticipating customer requirements at each level and creating demand-related plans of action prior to actual customer purchasing behavior
order fulfillment process
a highly integrated process, often requiring persons from multiple companies and multiple functions to come together and coordinate to create customer satisfaction at a given place and time
manufacturing flow management process
concerned with ensuring that firms in the supply chain have the needed resources to manufacture with flexibility and to move products through a multi-stage production process
supplier relationship management process
supports manufacturing flow by identifying and maintaining relationships with highly valued suppliers
product development and commercialization process
includes the group of activities that facilitates the joint development and marketing of new offerings among a group of supply chain partner firms
returns management process
enables firms to manage volumes of returned product efficiently while minimizing returns-related costs and maximizing the value of the returned assets to the firms in the supply chain
supply chain team
an entire group of individuals who orchestrate the movement of goods, services, and information from the source to the consumer
inventory control system
a method of developing and maintaining an adequate assortment of materials or products to meet a manufacturer’s or a customer’s demand
stockout
a situation where a customer demand for an inventory item goes unfulfilled because the requested item is unavailable at the needed time and place
cycle stock
inventory held temporarily for the purpose of fulfilling predicted demand in a period
safety (buffer) stock
extra inventory held in addition to cycle stock as insurance against unexpected demand increases
in-transit inventory
inventory that is currently moving within a transportation network to or from the company’s facilities (plant, warehouse, or sales location)
work-in-process inventory
materials inventory that is currently in the process of being converted into finished goods
seasonal inventory
an extra inventory buffer that is held in response to predictable demand increases that occur annually
materials requirement planning (MRP or materials management)
an inventory control system that manages the replenishment of raw materials, supplies, and components from the supplier to the manufacturer
distribution resource planning (DRP)
an inventory control system that manages the replenishment of goods from the manufacturer to the final consumer
automatic replenishment program
a real-time inventory system that triggers shipments only when a good is sold to the end user
order processing system
a system whereby orders are entered into the supply chain and filled
electronic data interchange (EDI)
information technology that replaces the paper documents that usually accompany business transactions, such as purchase orders and invoices, with electronic transmission of the needed information to reduce inventory levels, improve cash flow, streamline operations, and increase the speed and accuracy of information transmission
smart RFID (radio-frequency identification)
an inventory handling and tracking system that employs radio-frequency electromagnetic fields to transfer and read product data via an electronic tag
build-to-stock
a production method whereby products are made in advance of demand based on forecasts and are stored until customer orders arrive
mass customization (build-to-order)
a production method whereby products are not made until an order is placed by the customer; products are made according to customer specifications
postponement
a hybrid production method whereby basic units of a finished good are manufactured in advance of actual demand and held in strategic form or location until demand occurs, when final customization takes place
materials-handling system
a method of moving inventory into, within, and out of a warehouse
logistics information system
the link that connects all the logistics functions of the supply chain
sustainable supply chain management
a supply chain management philosophy that embraces the need for optimizing social and environmental costs in addition to financial costs
outsourcing (contract logistics)
a manufacturer’s or supplier’s use of an independent third party to manage an entire function of the logistics system, such as transportation, warehousing, or order processing
third-party logistics company (3PL)
a firm that provides functional logistics services to others
fourth-party logistics company (4PL or logistics integrator)
a consulting-based organization that assesses another’s entire logistical service needs and provides integrated solutions, often drawing on multiple 3PLs for actual service
offshoring
the outsourcing of a business process from one country to another for the purpose of gaining economic advantage
nearshoring
the transfer of an offshored activity from a distant to a nearby country
supply chain risk
any potential disruption that threatens the supply chain’s efficient and effective operations
supply chain security
efforts made by companies to protect their in-transit inventory or value-transforming assets from external or internal threats
supply chain resiliency
the ability of a supply chain to return to its ideal operational state after being disrupted
electronic distribution
a distribution technique that includes any kind of product or service that can be distributed electronically, whether over traditional forms such as fiber-optic cable or through satellite transmission of electronic signals
three-dimensional printing (3DP)
the creation of three-dimensional objects via an additive manufacturing (printing) technology that layers raw material into desired shapes
Reactive supply chain resiliency measures seek to protect key inventory and assets from damage, theft, or destruction.
True
False
False
Designing a new product with the help of suppliers and customers can enable a company to introduce features and cost cutting measures into final products.
True
False
True
It is important to limit the number of supply chain partners in the product development and commercialization process.
True
False
False
The customer relationship management process enables companies to prioritize their marketing focus on different customer groups according to each group’s long-term value to the company or supply chain.
True
False
True
The customer relationship management process includes customer segmentation by value and subsequent generation of customer loyalty for the most attractive segments.
True
False
True
Using three-dimensional printing (3DP) technology, objects are built to precise specifications using raw materials at or near the location where they may be consumed.
True
False
True
Fourth-party logistics companies (4PLs) often draw on multiple third-party logistics companies for actual service.
True
False
True
Supply chain management is a key means of differentiation for a firm and a critical component in marketing and corporate strategy.

True
False

True
New products and services are mostly the sole responsibility of a single firm in the supply chain.
True
False
False
In the customer relationship management (CRM) process, once higher-value customers are identified, firms should focus on identifying and attracting other groups by providing them with customized products and better services.
True
False
False
A strategic channel alliance is a cooperative agreement between business firms to use the other’s already established distribution channel.?
True
False
True
Sustainable supply chain management primarily involves integrating and balancing environmental, social, and economic thinking into all phases of the supply chain management process.?
True
Third-party logistics companies sell logistics solutions and physical products.?
True
False
False
Drop and shop programs use convenience to get consumers to recycle products, like batteries or cell phones, during a regular trip to the store.?
True
False
True
A similarity between the customer relationship management process and the supplier relationship management process is that both provide structural support for developing and maintaining relationships with their respective supply chain partners.?
True
False
True
Nearshoring leads to high costs and increases supply chain risk.?
True
False
False
The best order fulfillment processes increase order cycle time.?
True
False
False
DutiLog Inc. is a company that specializes in providing warehousing space and transportation solutions to a diverse group of firms. Given this information, DutiLog Inc. is an example of a third-party logistics company.?
True
False
True
Third-party logistics companies or logistics integrators are consulting-based organizations that assess another’s entire logistical service needs and provides integrated solutions, often drawing on multiple fourth-party logistics companies for actual service.?
True
False
False
In a multichannel marketing system, each channel does not hold its own inventory.?
True
False
False

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