A) offer greater efficiency in making goods available to target

Chapter 8 Marketing Channels: markets

Delivering Customer Value B) bring a fresh point of view to strategy development
C) eliminate risk
D) are generally backlogged with orders
1) Which of the following is NOT a typical supply chain member? E) refuse to store products for longer than a few days
A) resellers Answer: A Diff: 3 Page Ref: 342 Skill: Concept Objective: 12-1
B) customers
C) intermediaries 8) Intermediaries play an important role in matching ________.
D) government agencies A) dealer with customer
E) raw materials supplier B) supply and demand
Answer: D C) product to region
2) ________ the manufacturer or service provider is the set of D) manufacturer to product
firms that supply the raw materials, components, parts, E) information and promotion
information, finances, and expertise needed to create a product or Answer: B Diff: 2 Page Ref: 342 Skill: Concept Objective: 12-1
service.
A) Downstream from 9) Channel members add value by bridging the major gaps of
B) Upstream from ________ that separate goods and services from those who would
C) Disintermediated from use them.
D) Horizontal to A) time, need, and form
E) Parallel with B) place, possession, and form
Answer: B C) time, place, and possession
D) place, time, and need
3) Another term for the supply chain that suggests a sense and E) place, need, and distribution
respond view of the market is ________. Answer: C Diff: 2 Page Ref: 342 Skill: Concept Objective: 12-1
A) supply and demand chain
B) demand chain 10) Which of the following is NOT a key function that
C) channel of distribution intermediaries play in completing transactions?
D) distribution channel A) promotion
E) physical distribution B) information
Answer: B C) matching
D) risk taking
4) When suppliers, distributors, and customers partner with each E) negotiation
other to improve the performance of the entire system, they are Answer: D Diff: 3 Page Ref: 343 Skill: Concept Objective: 12-1
participating in a ________.
A) value delivery network 11) Which of the following is NOT a key function that
B) channel of distribution intermediaries play in helping to fulfill a completed transaction?
C) supply chain A) physical distribution
D) demand chain B) promotion
E) conventional distribution channel C) financing
Answer: A D) risk taking
E) storing goods
5) Most producers today sell their goods directly to ________. Answer: B Diff: 3 Page Ref: 343 Skill: Concept Objective: 12-1
A) final users
B) final users and marketing members 12) In a(n) ________ channel, the same member both produces
C) intermediaries and distributes a product or service.
D) warehouses A) tiered
E) third-party logistics providers B) direct
Answer: C Diff: C) horizontal
6) From the economic system's point of view, the role of marketing D) vertical
intermediaries is to transform the assortment of products made by E) exclusive
producers into the assortment of products wanted by ________. Answer: B Diff: 2 Page Ref: 343 Skill: Concept Objective: 12-1
A) channel members
B) distributors 13) In marketing terms, we say that the number of intermediary
C) consumers levels indicates the ________ of a channel.
D) manufacturers A) depth
E) marketers B) complexity
Answer: C Diff: 2 Page Ref: 342 Skill: Concept Objective: 12-1 C) involvement
7) Producers benefit from using intermediaries because they D) length
________. E) width
Answer: D Diff: 2 Page Ref: 343 Skill: Concept Objective: 12-1
 78) Which of the following is the best example of a direct channel?
14) At minimum, a marketing channel consists of a producer and A) J&L Manufacturing Company sells drapery hardware to The
a(n) ________. Home Depot's Design Center, and the Design Center then sells it to
A) wholesaler consumers.
B) agent B) Family Dollar Store sells modeling clay to school-age children.
C) broker C) A wholesaler sells candy to convenience stores, who then sell it
D) intermediary to store patrons.
E) customer D) Farmer Mintz sells corn to the Hughes household, who will eat
Answer: E Diff: 3 Page Ref: 343 Skill: Concept Objective: 12-1 it for supper.
E) A farmer in Columbia sells flowers to an international broker,
15) To a producer of goods, a greater number of channel levels who makes sure the flowers reach consumers in the United States.
means ________ and greater channel complexity. Answer: D Diff: 2 Page Ref: 343 AACSB: Analytic Skills Skill:
A) less distance between producer and end consumer Application Objective: 12-1
B) less control
C) fewer potential ideas 79) Steve's Physco Skates sells its products to Walmart, who then
D) higher taxes sells them to the consumer. This is an example of a(n) ________.
E) fewer channel partners A) direct marketing channel
Answer: B Diff: 2 Page Ref: 344 Skill: Concept Objective: 12-1 B) producer channel
C) indirect marketing channel
16) Which of the following is an example of a complete business- D) retailer channel
to-business channel? E) corporate vertical marketing system
A) producer to retailer to consumer Answer: C Diff: 2 Page Ref: 343 AACSB: Analytic Skills Skill:
B) producer to wholesaler to retailer to consumer
C) producer to sales branch 18) A distribution channel is more than a collection of firms
D) business distributor to business customer connected by various flows; it is a(n) ________ in which people
E) producer to distributor to business customer and companies interact to accomplish individual, company, and
Answer: E Diff: 2 Page Ref: 344 Skill: Concept Objective: 12-1 channel goals.
A) added value chain
17) All of the institutions in a channel are connected by flows, B) complex behavioral system
including physical flow, flow of ownership, payment flow, C) corporate marketing system
information D) vertical marketing system
flow, and ________ flow. E) multichannel system
A) promotion Answer: B Diff: 2 Page Ref: 344 Skill: Concept Objective: 12-2
B) acquisition
C) customer 19) An advantage of a channel of distribution over selling direct to
D) return product consumers is that each channel member plays a(n) ________ in the
E) by-product channel.
Answer: A Diff: 2 Page Ref: 344 Skill: Concept Objective: 12-1 A) time-saving part
B) specialized role
76) Proud Pets, a producer of clothing and accessories for pets, has C) decisional role
recently partnered with a regional chain of pet stores. Which of the D) informational role
following would Proud Pets be LEAST likely to expect from its E) disciplinary role
new channel member? Answer: B Diff: 2 Page Ref: 344 Skill: Concept Objective: 12-2
A) promoting its products through advertising
B) assembling and packaging its products for final sale 20) Joanie Calvert is experiencing a disagreement with
C) distributing relevant marketing research information intermediaries in the channel over who should do what and for
D) identifying raw materials and other productive inputs what rewards. Joanie is experiencing ________.
E) negotiating on its products' prices A) a tying disagreement
Answer: D Diff: 2 Page Ref: 342-343 AACSB: Reflective B) channel conflict
Thinking Skills Skill: Application Objective: 12-1 C) channel disintermediation
D) third-party logistics
77) Which of the following is NOT a marketing intermediary? E) channel intermediation
A) the supplier of the raw materials used to make glass windows Answer: B Diff: 1 Page Ref: 344 Skill: Concept Objective: 12-2
B) the distributor who sells stained glass windows
C) the wholesaler who buys the stained glass window from its 21) ________ conflict, which occurs between different levels of
creator the same channel, is more common than ________ conflict, which
D) the showroom that displays glass windows for customers to see occurs among firms at the same level of the channel.
E) the manufacturers' agent who sells the stained glass windows A) Horizontal; vertical
Answer: A Diff: 2 Page Ref: 342 AACSB: Analytic Skills Skill: B) Vertical; horizontal
Application Objective: 12-5 C) Contractual; corporate
D) Corporate; franchise
E) Wholesaler; retailer channel are attained through ________.
Answer: B Diff: 2 Page Ref: 344 Skill: Concept Objective: 12-2 A) agents and brokers
B) unspoken partnerships
22) Historically, ________ have lacked the leadership to assign C) limited liability incorporation
member roles and manage conflict. D) contractual agreements
A) corporate vertical marketing systems E) natural competitive forces
B) contractual vertical marketing systems Answer: D Diff: 1 Page Ref: 346 Skill: Concept Objective: 12-2
C) conventional distribution channels
D) administered vertical marketing systems 29) The most common type of contractual relationship in business
E) conventional vertical marketing systems is the ________.
Answer: C Diff: 2 Page Ref: 345 Skill: Concept Objective: 12-2 A) franchise organization
B) administered marketing system
23) A conventional distribution channel consists of one or more C) conventional marketing channel
________ producers, wholesalers, and retailers. D) corporate VMS
A) product-related E) horizontal marketing system
B) independent Answer: A Diff: 1 Page Ref: 346 Skill: Concept Objective: 12-2
C) contract
D) estranged 30) Leadership in which type of marketing system is assumed not
E) merchant through common ownership or contractual ties but through the size
Answer: B Diff: 2 Page Ref: 345 Skill: Concept Objective: 12-2 and power of one or a few dominant channel members?
A) horizontal marketing system
24) A channel consisting of one or more separate producers, B) administered VMS
wholesalers, or retailers that seek to maximize their own profit- C) corporate VMS
even at the expense of profits for the channel as a whole-is a(n) D) multichannel distribution system
________. E) conventional marketing channel
A) vertical marketing system Answer: B Diff: 1 Page Ref: 348 Skill: Concept Objective: 12-2
B) conventional distribution channel
C) independent channel allocation 31) In a ________, two or more companies at one level join
D) corporate VMS together to develop a new marketing opportunity.
E) administered vertical marketing system A) franchise
Answer: B Diff: 2 Page Ref: 345 Skill: Concept Objective: 12-2 B) horizontal marketing system
C) corporate VMS
25) An advantage of a vertical marketing system (VMS) is that it D) multichannel distribution system
acts as a ________ system. E) conventional distribution channel
A) unified Answer: B Diff: 1 Page Ref: 348 Skill: Concept Objective: 12-2
B) creative
C) modern 32) Which of the following is an example of a manufacturer-
D) customer-driven sponsored retailer franchise system?
E) task-driven A) fast-food restaurants such as McDonald's and Burger King
Answer: A Diff: 3 Page Ref: 345 Skill: Concept Objective: 12-2 B) Starbucks operating within Target stores
C) Ford and its network of independent franchised dealers
26) A corporate VMS has the advantage of controlling the entire D) licensed bottlers that bottle and sell Coca-Cola to retailers
distribution chain through ________. E) motels such as Holiday Inn and Ramada Inn
A) a profit-maximizing strategic plan Answer: C Diff: 3 Page Ref: 347 Skill: Concept Objective: 12-2
B) single ownership
C) mass distribution 33) When McDonald's offers its products inside of a Walmart
D) contracts among separate members store, it is using a(n) ________.
E) franchise agreements A) conventional distribution channel
Answer: B Diff: 1 Page Ref: 345 Skill: Concept Objective: 12-2 B) corporate VMS
C) contractual VMS
27) Which of the following are the three major types of vertical D) administered VMS
marketing systems? E) horizontal marketing system
A) corporate, contractual, and chain Answer: E Diff: 3 Page Ref: 348 Skill: Concept Objective: 12-2
B) contractual, corporate, and independent
C) contractual, corporate, and administered 34) As marketing manager for Globe Imports and Exports, you
D) administered, independent, and franchised want to start reaping the benefits of a multichannel distribution
E) contractual, corporate, and task system.
Answer: C Diff: 2 Page Ref: 345 Skill: Concept Objective: 12-2 You will likely enjoy all of the following EXCEPT which one?
28) A distinguishing feature of a contractual VMS is that A) expanded sales
coordination and conflict management among the independent B) expanded market coverage
members of the C) selling at a higher gross margin
D) opportunities to tailor products and services to the needs of 83) Which of the following is an example of a multichannel
diverse segments distribution system?
E) A and C A) Walmart locating to several countries
Answer: C Diff: 3 Page Ref: 349 AACSB: Dynamics of the Global B) JC Penney's catalog and retail store sales
C) Avon's door-to-door distribution
35) Which of the following is the most likely disadvantage of D) Starbuck's location inside of book stores
adding new channels in a multichannel distribution system? E) a hotel providing guest privileges at a health spa across the
A) decreasing understanding of complex markets street
B) decreasing control over the system Answer: B Diff: 2 Page Ref: 349 AACSB: Analytic Skills Skill:
C) fewer opportunities for franchising
D) increasing disintermediation 84) Blockbuster offers DVD rentals through its Total Access
E) reducing conflict among channel members online rental service and through its bricks-and-mortar stores. This
Answer: B Diff: 2 Page Ref: 349 Skill: Concept Objective: 12-2 is an example of a(n)________.
A) contractual VMS
36) Due in a large part to advances in technology, ________ is a B) administered VMS
major trend whereby product and service producers are bypassing C) horizontal marketing system
intermediaries and going directly to final buyers, or radically new D) conventional distribution channel
types of channel intermediaries are emerging to displace traditional E) multichannel distribution system
ones. Answer: E Diff: 2 Page Ref: 349 AACSB: Analytic Skills Skill: 2
A) the vertical marketing system
B) the corporate marketing system 85) When Netflix began delivering DVDs directly to customers
C) disintermediation through the mail instead of using a brick-and-mortar system,
D) the corporate merger Netflix was following the trend of ________.
E) the hostile takeover A) indirect marketing
Answer: C Diff: 2 Page Ref: 350 AACSB: Use of Information B) disintermediation
Technology Skill: Concept Objective: 12-2 C) a franchise system
D) exclusive distribution
80) When two Taco Bell restaurants have a disagreement over who E) selective distribution
should be able to sell in quantity at a discount to the local high Answer: B Diff: 2 Page Ref: 350 AACSB: Analytic Skills Skill:
school
band, they are in a ________ conflict. 94) Which type of vertical marketing system (VMS) gives an
A) vertical organization more control over both production and resale of its
B) conventional channel products, while at the same time increasing the organization's
C) logistics capital investment and its fixed costs?
D) horizontal A) administered
E) functional B) contractual
Answer: D Diff: 2 Page Ref: 344 AACSB: Reflective Thinking C) conventional
D) corporate
81) Staples Office Supply opened an online store that created E) horizontal
competition with many of its dealers. The corporate office created Answer: D Diff: 3 Page Ref: 346 AACSB: Reflective Thinking
a(n)________ conflict. Skills Skill: Critical Thinking Objective: 12-2
A) vertical
B) conventional channel 37) The four major steps of designing a channel system are
C) logistics analyzing consumer needs, setting channel objectives, ________,
D) horizontal and evaluating the alternatives.
E) intermediation A) establishing a budget
Answer: A Diff: 2 Page Ref: 344 AACSB: Reflective Thinking B) identifying major channel alternatives
C) seeking regulatory approval
82) Which of the following is an example of horizontal channel D) seeking legal advice
conflict? E) measuring objectives
A) managers of two separate Holiday Inns disagreeing over what Answer: B Diff: 2 Page Ref: 351 Skill: Concept Objective: 12-3
constitutes poor service
B) United Airlines competing with Northwest Airlines for 38) Which of the following should be the first step in designing a
customers marketing channel?
C) disgruntled factory workers complaining about a small pay raise A) identifying channel objectives
D) the BMW dealership in Fort Wayne complaining that the BMW B) identifying what consumers want from the channel
dealership in Indianapolis is situated too close C) analyzing channel alternatives
E) A and D D) evaluating intermediaries
Answer: E Diff: 3 Page Ref: 344 AACSB: Analytic Skills Skill: E) exploring international opportunities
Application Objective: 12-2 Answer: B Diff: 2 Page Ref: 351 Skill: Concept Objective: 12-3
39) To increase a channel's service level, the channel must provide C) shopping products
a greater assortment of products, more add-on services, or D) luxury products
________. E) supplies
A) lower prices Answer: A Diff: 2 Page Ref: 352-353 Skill: Concept Objective:
B) fewer middlemen 12-3
C) faster delivery
D) more competition 46) Sometimes a producer chooses only a few dealers in a territory
E) less follow-up to distribute its products or services. Generally these dealers are
Answer: C Diff: 2 Page Ref: 351 Skill: Concept Objective: 12-3 given a right to ________ distribution.
A) exclusive
40) Companies should state their channel objectives in terms of B) selective
targeted levels of ________. C) intensive
A) co-op advertising D) administered
B) efficiency E) corporate
C) customer service Answer: A Diff: 1 Page Ref: 353 Skill: Concept Objective: 12-3
D) conflict reduction
E) profitability 47) Which type of distribution is used when the producer wants
Answer: C Diff: 2 Page Ref: 352 Skill: Concept Objective: 12-3 more than one, but fewer than all, of the intermediaries who are
willing to
41) When a company is identifying its major channel alternatives, carry its products?
it should consider its choices in terms of ________ of A) exclusive
intermediaries. B) selective
A) size, power, and profitability C) intensive
B) power, cooperativeness, and location D) administered
C) types, number, and responsibilities E) corporate
D) capacity, creativity, profitability Answer: B Diff: 1 Page Ref: 353 Skill: Concept Objective: 12-3
E) types, breadth, depth
Answer: C Diff: 2 Page Ref: 352 Skill: Concept Objective: 12-3 48) When establishing the responsibilities of channel members, the
producer establishes a list price, sets discounts for intermediaries,
42) Which product will most likely be intensively distributed? and
A) Olympus digital cameras defines each channel member's ________.
B) BMW cars A) sales limits
C) Guess blue jeans B) territory
D) Coca-Cola C) legal rights
E) Nike running shoes D) customers
Answer: D Diff: 2 Page Ref: 352-353 Skill: Concept Objective: E) mission
Answer: B Diff: 2 Page Ref: 353 Skill: Concept Objective: 12-3
43) Which type of product might require a more direct marketing
channel to avoid delays and too much handling? 49) When a company compares the likely sales, costs, and
A) lower-priced products profitability of different channel alternatives, it is using ________
B) perishable products criteria to
C) high-priced products evaluate its channel options.
D) products in their maturity stage A) selective
E) products in their decline stage B) adaptive
Answer: B Diff: 2 Page Ref: 352 Skill: Concept Objective: 12-3 C) economic
D) control
44) When determining the number of channel members to use at E) distribution
each level, three strategies are available: intensive, exclusive, and Answer: C Diff: 2 Page Ref: 353 Skill: Concept Objective: 12-3
________ distribution.
A) multichannel 50) It is most common for international marketers to ________
B) selective their channel strategies for each country.
C) international A) extend
D) direct B) adapt
E) extensive C) restrict
Answer: B Diff: 1 Page Ref: 352 Skill: Concept Objective: 12-3 D) seek approval for
E) eliminate
Answer: B Diff: 2 Page Ref: 354 AACSB: Dynamics of the Global
45) An intensive distribution strategy is most suitable for which Economy Skill: Concept Objective: 12-3
consumer product category?
A) convenience products
B) unsought goods
51) China and India each contain more than one billion people. network of independent dealers. Caterpillar has shared its
However, companies can access only a small percentage of these successes with its dealers and protected its dealers during difficult
potential markets due to ________. economic times. This is an example of ________.
A) inadequate distribution systems A) intensive distribution
B) indifference toward Western products B) integrated logistics management
C) high regional taxes C) disintermediation
D) the religious caste system D) 3PL
E) insurmountable language barriers E) PRM
Answer: A Diff: 3 Page Ref: 354 AACSB: Dynamics of the Global Answer: E Diff: 2 Page Ref: 355 Skill: Concept Objective: 12-4

86) Chewing gum is stocked in many outlets in the same market or 55) Sometimes a seller requires its dealers to abstain from handling
community; in fact, it is placed in as many outlets as possible. This competitors' products in an arrangement called ________.
is an example of ________ distribution. A) exclusive distribution
A) exclusive B) exclusive dealing
B) selective C) selective distribution
C) multichannel D) exclusive pricing
D) intensive E) disintermediation
E) disintermediated Answer: B Diff: 2 Page Ref: 356 AACSB: Ethical Understanding
Answer: D Diff: 2 Page Ref: 352-353 AACSB: Analytic Skills and Reasoning Abilities Skill: Concept Objective: 12-4

87) Which product will most likely be exclusively distributed? 56) Exclusive dealing is legal as long as it does not ________ or
A) BMW cars tend to create a monopoly and as long as both parties enter into the
B) Levi's blue jeans agreement ________.
C) Bazooka bubble gum A) substantially lessen competition; coercively
D) Prairie Farms yogurt B) restrict trade; for a cause
E) Coca-Cola C) substantially lessen competition; voluntarily
Answer: A Diff: 2 Page Ref: 353 AACSB: Reflective Thinking D) interfere with competitors; forcefully
E) create a smaller market; permanently
88) Tiffany & Co jewelry can only be found in a limited number of Answer: C Diff: 3 Page Ref: 356 AACSB: Ethical Understanding
intermediaries. This is an example of ________ distribution. and Reasoning Abilities Skill: Concept Objective: 12-4
A) exclusive
B) intensive 57) A producer of a strong brand that agrees to sell its brand to a
C) quality dealer only if the dealer will take some or all of the rest of the line
D) high-end is using ________.
E) independent A) exclusive distribution
Answer: A Diff: 2 Page Ref: 353 AACSB: Analytic Skills Skill: B) exclusive dealing
C) intensive distribution
52) A company should think of its intermediaries as both its D) a tying agreement
________ and ________. E) disintermediation
A) competitors; partners Answer: D Diff: 2 Page Ref: 357 AACSB: Ethical Understanding
B) customers; partners and Reasoning Abilities Skill: Concept Objective: 12-4
C) competitors; marketers
D) customers; employees 95) Why is it important for manufacturers to be sensitive to the
E) competitors; customers needs of their dealers?
Answer: B Diff: 2 Page Ref: 355 Skill: Concept Objective: 12-4 A) Dealers have few legal rights.
B) Manufacturers have few legal rights.
53) Most companies practice strong PRM to forge long-term C) Dealers can easily be replaced by third-party logistics providers.
relationships with channel members. What does PRM stand for? D) Dealer support is essential to creating value for the customer.
A) primary relationship management E) Manufacturers cannot break commitments to channel.
B) potential relationship management Answer: D Diff: 2 Page Ref: 355 AACSB: Reflective Thinking
C) perennial relationship management Skills Skill: Critical Thinking Objective: 12-4
D) partner relationship management
E) personnel roster maintenance 58) Marketing logistics involves getting the right product to the
Answer: D Diff: 1 Page Ref: 355 Skill: Concept Objective: 12-4 right customer in the right place at the right time. Which one of the
following is NOT included in this process?
A) planning the physical flow of goods and services
B) implementing the plan for the flow of goods and services
54) Caterpillar, the famous heavy equipment manufacturer, has a C) controlling the physical flow of goods, services, and
reputation for working in harmony with its worldwide distribution information
D) gathering customer's ideas for new products
E) planning the flow of logistics information to meet customer A) store goods for longer periods
requirements at a profit B) hold larger volumes
Answer: D Diff: 1 Page Ref: 357 Skill: Concept Objective: 12-5 C) move goods rather than just store them
D) primarily be owned by the manufacturer
59) Marketing logistics involves which of the following E) be automated
distribution flows? Answer: C Diff: 2 Page Ref: 360 Skill: Concept Objective: 12-5
A) outbound and inbound only
B) outbound, inbound, and reverse 66) To reduce inventory management costs, many companies use a
C) inbound and reverse only system called ________, which involves carrying only small
D) outbound and reverse only inventories of parts or merchandise, often only enough for a few
E) outbound only days of operation.
Answer: B Diff: 2 Page Ref: 357 Skill: Concept Objective: 12-5 A) reduction-inventory management
B) just-in-time logistics
60) ________ logistics controls the movement of products from C) limited inventory logistics
points of production to consumers. D) supply chain management
A) Inbound E) economic order quantity
B) Reverse Answer: B Diff: 2 Page Ref: 361 AACSB: Use of Information
C) Outbound Technology Skill: Concept Objective: 12-5
D) Vertical
E) Horizontal 67) Through the use of ________, or "smart tag" technology, a
Answer: C Diff: 2 Page Ref: 357 Skill: Concept Objective: 12-5 company is able to locate a product's exact position within the
supply chain.
61) ________ logistics concerns the methods consumers use to A) RFID
send products to a producer for return or repair. B) PRM
A) Inbound C) VMS
B) Reverse D) IT
C) Outbound E) 3PL
D) Vertical Answer: A Diff: 2 Page Ref: 361 AACSB: Use of Information
E) Horizontal Technology Skill: Concept Objective: 12-5
Answer: B Diff: 2 Page Ref: 357 Skill: Concept Objective: 12-5
68) Which of the following transportation modes is used for digital
62) Which of the following is NOT an area of responsibility for a products?
logistics manager? A) trucks
A) information systems B) rail
B) warehousing C) the Internet
C) promotions D) air
D) inventory E) ship
E) purchasing Answer: C Diff: 1 Page Ref: 362 AACSB: Use of Information
Answer: C Diff: 2 Page Ref: 358 Skill: Concept Objective: 12-5 Technology Skill: Concept Objective: 12-5

63) Which of the following innovations has created opportunities 69) In the proper order, identify the correct terms for these
for significant gains in distribution efficiency? intermodal transportation combinations: rail and truck, water and
A) tying agreements truck, water and rail.
B) Web-based logistics systems A) fishyback; airtruck; trainship
C) customer relationship management B) piggyback; airtruck; fishyback
D) contractual vertical marketing systems C) trainship; fishyback; piggyback
E) storage warehouses D) piggyback; fishyback; trainship
Answer: B Diff: 2 Page Ref: 358 AACSB: Use of Information E) piggyback, fishyback; birdyback
Technology Skill: Concept Objective: 12-5 Answer: D Diff: 2 Page Ref: 362-363 Skill: Concept Objective:
12-5
64) The goal of marketing logistics should be to provide a
________ level of customer service at the least cost. 70) Using ________, retailers can share real-time data on sales and
A) maximum current inventory levels with suppliers who take responsibility for
B) targeted ordering and delivering products to retailers, thereby saving time
C) moderate and money.
D) minimum A) dual distribution modes
E) noncompetitive B) continuous inventory replenishment systems
Answer: B Diff: 2 Page Ref: 358 Skill: Concept Objective: 12-5 C) an Intranet
D) intensive distribution
65) The difference between distribution centers and storage E) integrated distribution
warehouses is that distribution centers are designed to ________.
Answer: B Diff: 2 Page Ref: 363 AACSB: Use of Information Answer: A Diff: 3 Page Ref: 353 AACSB: Analytic Skills Skill:
Technology Skill: Concept Objective: 12-5 Application Objective: 12-4

71) Lancaster Box Company wants to provide better customer 90) Fresh Direct, an online grocer delivering to homes and offices
service while trimming distribution costs through teamwork, both in and around New York City, recently switched its entire fleet to
inside the company and among all the marketing channel biodiesel trucks. These trucks run on used cooking oil rather than
organizations. Lancaster Box is thinking of ________. gas, drastically reducing the company's carbon dioxide footprint.
A) integrated logistics management Fresh Direct has developed a(n) ________.
B) vendor-managed inventory A) indirect marketing channel
C) customer relationship management B) green supply chain
D) third-party logistics C) tying agreement
E) disintermediation D) intermodal transportation system
Answer: A Diff: 2 Page Ref: 363 Skill: Concept Objective: 12-5 E) exclusive dealing system
Answer: B Diff: 2 Page Ref: 358 AACSB: Analytic Skills Skill:
72) Which of the following best states the goal of integrated supply Application Objective: 12-5
chain management?
A) to stabilize costs 91) Jewels for the Rich and Famous sells very exclusive jewelry
B) to increase services with minimal cost through teamwork with a minimum price of $25,000 to customers around the world.
C) to harmonize all of the company's logistics decisions Speed of delivery to distant markets is a must. Management should
D) to eliminate conflict and increase cooperation among channel consider using ________ as its main carrier.
members A) rail
E) to ensure consistent services with minimal costs B) air
Answer: C Diff: 3 Page Ref: 363 Skill: Concept Objective: 12-5 C) truck
D) the Internet
73) When Home Depot allows key suppliers to use its stores as a E) water
testing ground for new merchandising programs, it is conducting Answer: B Diff: 2 Page Ref: 362 AACSB: Reflective Thinking
a(n) ________. Skills Skill: Application Objective: 12-5
A) integrated logistics system
B) partnership management system 92) Grayville Rock and Gravel, located in a seaport town, sells
C) shared project rock, gravel, and sand to local markets. It has just been awarded a
D) third-party project contract with a company 500 miles down the coast. Management
E) cross-functional, cross-company team should consider switching from truck to ________ transport.
Answer: C Diff: 2 Page Ref: 364 Skill: Concept Objective: 12-5 A) water
B) rail
74) Today, a growing number of firms now outsource some or all C) pipeline
of their logistics to ________. D) air
A) cross-functional teams E) none of the above
B) disintermediaries Answer: A Diff: 2 Page Ref: 362 AACSB: Reflective Thinking
C) horizontal channel members Skills Skill: Application Objective: 12-5
D) third-party logistics providers
E) competitors 93) Which of the following modes of transportation would most
Answer: D Diff: 1 Page Ref: 364 Skill: Concept Objective: 12-5 likely be used to quickly haul lettuce from California where it was
grown to markets in Nevada?
75) UPS Supply Chain Solutions, which handles all of its clients' A) trucks
"grunt work" associated with logistics, is an example of ________. B) piggyback
A) integrated logistics management C) air
B) a distribution center D) pipeline
C) selective distribution E) water
D) a third-party logistics provider Answer: A Diff: 2 Page Ref: 362 AACSB: Reflective Thinking
E) a cross-functional, cross-company team
Answer: D Diff: 2 Page Ref: 365 Skill: Concept Objective: 12-5 96) What type of utility does warehousing provide to consumers by
holding onto products until consumers need them?
89) Max Samuelson is a high-end fashion designer who markets A) time
his clothing lines through a limited number of highly reputable B) ownership
retailers. C) production
Max uses ________. D) form
A) exclusive distribution E) packaging
B) exclusive dealing Answer: A Diff: 3 Page Ref: 360 AACSB: Reflective Thinking
C) exclusive territorial agreements Skills Skill: Synthesis Objective: 12-5
D) full-line forcing 97) A manufacturer that uses a third-party logistics provider to
E) tying agreements fulfill all of its logistics need is using a(n) ________.
A) direct marketing channel
B) conventional distribution channel
C) corporate vertical marketing system
D) horizontal marketing system
E) franchise organization
Answer: B Diff: 3 Page Ref: 364 AACSB: Reflective Thinking
Skills Skill: Synthesis Objective: 12-5

99) Management at a chain of Indiana grocery stores with a long

history of purchasing products from Miller Meat is unhappy with
the timing of deliveries. In fact, the grocery store's management is
considering switching to another meat supplier who will delivery
more frequently. This is an example of a(n) ________ conflict.
A) independent channel
B) vertical
C) horizontal
D) intermodal
E) conventional
Answer: B Diff: 2 Page Ref: 344 AACSB: Analytic Skills Skill:
Application Objective: 12-2

100) In using air transportation and then expedited truck carriers to

deliver specialty items to customers outside of a designated
delivery
range, Miller Meats is using ________.
A) all of its supply chain
B) all of its value delivery network
C) direct marketing channels
D) intermodal transportation
E) a horizontal marketing system
Answer: D Diff: 2 Page Ref: 362 AACSB: Analytic Skills Skill: