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Exam 15: Distributing Products

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Question 81

True/False

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Hartselle Home Products, Inc., manufacturers a variety of inexpensive household gadgets. The company has decided to cut costs by eliminating all of the marketing intermediaries who help distribute its products. Hartselle will be able to reduce its total marketing costs by eliminating the marketing functions these intermediaries perform.

A) True
B) False

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verified

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Question 82

True/False

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Fancy Feet sells high quality socks and stockings by sending catalogs to customers and offering them a toll-free telephone number so that they can call in their orders 24 hours a day any day of the year. Fancy Feet uses telemarketing.

A) True
B) False

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Question 83

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Which of the following is an example of a consumer making a purchase through a direct marketing arrangement?

Discount stores and department stores sell different brands of products that are usually priced about the same.

Vending machines are most often used to sell:

Department stores offer a wide variety of products that are sold in separate departments.

Retail organizations employ more than 11 million people in the U.S.

Most marketing intermediaries have survived in the past because consumers were unaware of how much these companies add to the cost of distributing goods.

The costs added by marketing intermediaries usually outweigh the value they create.

In a(n) , independently owned and managed stores sign an agreement to use the same name, participate in chain promotions, and cooperate as a unified system.

A(n) distribution strategy uses only one retail outlet in a given geographic area.

Suppose that eight bakeries each tried to sell their products directly to seven supermarkets. The total number of exchange relationships that would be established is:

TasteBest Spice Company was unable to get retailers to agree to a contractual arrangement to cooperate in the distribution process, so it took over all of the marketing functions for its products at grocery stores. The grocers like this arrangement because TasteBest provides outstanding marketing support for its products. TasteBest is using a(n) system to distribute its products.

Imaginex Toys, Inc. produces toys designed to stimulate the imaginations of young children. In order to control all of the marketing operations, Imaginex owns all of the organizations in the channel of distribution for its toys, including a chain of Imaginex retail stores. The approach taken by Imaginex is known as an administered distribution system.

The main difference between selective distribution and exclusive distribution is the number and type of market segments the firm chooses. In a selective strategy, a variety of profitable niche markets are selected, while in an exclusive strategy one specific market segment is targeted, and all others are excluded.

There are four specific types of channel systems available to companies that tie firms together in a unified way.

A(n) consists of the marketing intermediaries that transport and store goods as they move through their path from producer to final user.

warehouses are used to gather and redistribute products.

Rack jobbers sell goods on consignment, splitting the profits from their sales with a retailer.

Merrill helps growers of fresh fruits and vegetables negotiate sales to food processing companies. However, once he has helped negotiate the transaction, he does not maintain a long-term relationship with the growers. Merrill is an example of a sales agent in this market.