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Exam 15: Distributing Products

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Question 91

True/False

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The air freight industry is starting to focus on global distribution.

A) True
B) False

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Question 92

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Direct selling has all but disappeared as a major form of nonstore retailing because the trend toward two-income households means fewer opportunities for selling in the home.

A) True
B) False

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Question 93

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Chris Cole is a salesperson for Green Scene Lawn Care products. Chris' job requires him to sell Green Scene products, but he is also expected to recruit more salespeople for the company. He will earn a commission on all of the sales earned by the salespeople he recruits. Green Scene is using a retail distribution strategy known as multilevel marketing.

Tammy Knowles is the publisher of "New Woman Magazine," which is a publication targeted to Gen Y women. Because it is a small, new publication, some of the larger bookstores, convenience stores and newsstands are not agreeing to distribute the magazine. Tammy is very concerned by this trend, because she believes that her publication, like most magazines, needs distribution in order to succeed.

Mini-Case "We've got a number of important issues to discuss today," began Dee Stribyute as she opened the weekly marketing manager's meeting for Lite Bite Foods. Lite Bite is a producer of low fat, low calorie snack foods. The other managers attending the meeting were her two top assistants, Mark Etter and Rhea Taylor. "First, sales were hurt last year when we had to recall our almond chocolate bars because of concerns about contaminated ingredients. We've got our work cut out for us to recover from that setback. Many stores quit carrying our products, and even the ones that continued to do so put less emphasis on displaying and promoting them. We've got to get our products into as many stores as possible. Consumers shouldn't have to go all over town trying to find our snacks. We also need to make sure that our products are displayed and promoted in a way that attracts attention." Dee looked at her assistants, and saw that they seemed ready to make some proposals. However, she decided to get another important issue out on the table before stopping to discuss solutions, so she continued with her comments. "The other big concern is the cost of moving our goods. Distribution costs are a major part of the overall cost of selling our goods. What can we do to make the flow of products from our kitchens to our ultimate consumers more efficient?" Having laid out her concerns, Dee sat down at the head of the table, saying to her assistants, "O.K. guys, I'm ready for suggestions." -Dee's comments about the need to get Lite Bite products into additional retail outlets suggests the company wants to use a(n) :

Logistics involves planning, implementing, and controlling the physical flow of materials, final goods, and related information from points of origin to points of consumption.

warehouses are used to hold products for a relatively long time.

Bunny Babbett has just become an independent contractor selling the products of Tweethouse, a firm that makes elaborate (and expensive) birdhouses and bird feeders. Bunny was recruited to the firm by Sylvester Katt, who already sells the Tweethouse products as an independent contractor. Sylvester told Bunny that both he and she would receive a commission on every item she sold. He also pointed out that she could boost her income significantly by recruiting more people to sell the products, because she would receive a commission on her recruits' sales. The arrangement described by Sylvester suggests that Tweethouse is using:

The activities performed by most marketing intermediaries are not essential to the marketing process.

put many small shipments together to create a single large shipment that can be transported more cost-efficiently to the final destination.

Kidder Manufacturing wants to ship a large quantity of its goods across the country. They have contacted Wayback Shipping, Inc. to find out what the shipment would cost. Wayback has shown Kidder how it can arrange to use a combination of barges, trains, and trucks to complete the shipment at a low cost. Wayback's strategy is an example of:

Wholesalers are marketing intermediaries who sell goods or services to ultimate consumers.

A (n) is one type of marketing intermediary that brings together buyers and sellers and assists in negotiating an exchange, but does not take title to the goods.

Specialty stores use a wide variety of products in one product category as their key competitive tool.

A category killer is an extremely successful product that kills the sales of other products in its category in a retail store.

Vending machines are used primarily to sell goods where consumers have little interest in convenience.

Taken together, all of the organizations that move goods from the sources of raw materials to ultimate consumers is known as a (n) :

Supply chain management manages the movement of relevant information as well as the movement of parts and finished goods through all organizations involved in the supply chain.

In multilevel marketing, salespeople not only sell the product, they also recruit other people to sell the product.

Currently, in the United States the greatest volume of goods and services is shipped by: