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Distribution and Logistics Management-2


SKU: AMSEQ-070 Category:


Answer any five questions:
Q1. Explain the types of marketing channels and the role of marketing channels in marketing strategy.
Q2. Explain the major functions of logistics.
Q3. Discuss the factors affecting the selection and design of the channels.
Q4. What are the key elements of logistics? Explain each in brief.
Q5. What are the different causes of conflict? How the conflict can be managed?
Q6. Define merchandising technique. What does the basic technique include?

Notes: Subjective type Questions & Case Study

Q1. What are the strategic issues in retailing?
Q2. Explain the importance of Logistics. What are its goals?
Q3. What are key issues in logistic planning?
Case Study


The prevalent logistics mindset must move from one of complexity and cost efficiencies to one of revenue and margin enhancement. The imperative of providing logistics services represent a great and untapped area for providing increased value to the purchasing. When customers purchase, they buy more than a product. They also buy a bundle of services provided by the supplier. This includes components like pricing flexibility, promotion/ deal or other discounts, credit and other payment terms, merchandising support, after-sales support and delivery or logistics support Customers’ requirements for logistics services, however, vary by customer or product. The onesize-fits-all approach to logistics service often leads to average service which may be over servicing some customers while under-servicing others!

In a large pharmaceutical firm, all orders were processed as emergencies although 85 % of them were for replenishments as the firm thought that all its customers needed short delivery. This way it was over-servicing some customers and its costs were higher. The suppliers’ challenge was to improve service to some and reduce its level for others and thus reduce the overall cost that, in ultimate analysis, help both the customers and suppliers.

a) Describe the bundle of services that must accompany a tangible product in order to achieve higher customer satisfaction.
b) Justify that every industry is operating in service sector and cannot do without improving its service satisfaction to end consumers.

1. The total logistics cost includes expenses associated with transportation, materials handling and:
a) customer complaints, cost of food and highway usage taxes
b) warehousing, inventory, stock outs and order processing
c) inventory control with sales forecasting
d) stock outage control with sales forecasting

2. The inventory management systems designed to reduce the retailer’s lead time for receiving merchandise is called:
a) efficient consumer response delivery system.
b) effective response.
c) on-time market delivery system.
d) efficient logistical response.
3. The total logistics cost factors need to be balanced against the:
a) supply chain managers total experience
b) total expected transportation needs
c) customer service factors
d) lead time expectations
4. There are five basic transportation modes. They are air carrier, motor carrier, and:
a) pipelines, railways an water carriers
b) railways, ocean vessels and dirigibles
c) trucks, canals and robotics
d) water routes, railways and trucks
5. Rail has the largest shipping capacity compared to all except:
a) pipeline
b) air carrier
c) water carrier
d) motor carrier
6. The most costly logistics activity in many firms is ____________.
a) industrial packaging
b) warehousing management
c) order management
d) transportation management

7. The most common logistical intermediary is a:
a) cargo surveyor
b) freight forwarder
c) freight broker
d) bank (finance company)

8. Channel intermediaries:
a) assume temporary ownership of the goods
b) fill niches
c) disappear as the market becomes organized
d) tend to lack focus

9. The ____________ channel handles the physical flow of product.
a) ownership
b) negotiations
c) logistics
d) promotions

10. Which of the following is not part of the marketing channel?
a) the logistics channel
b) the negotiations channel
c) the promotion channel
d) the finance channel
e) all are part of the marketing channel

11.Which of the following is not a reason for the increased importance of logistics?
a) growing power of manufacturers
b) reduction in economic regulation
c) globalization of trade
d) technological advances
e) all of the above are reasons

12. What is a marketing channel?
a) A set of independent organisations involved in the process of making a product (good, service or experience) available for use or consumption by consumers or businesses
b) The gathering and distributing of marketing research to all members of a firm’s marketing department
c) A profit-sharing system designed to reward with bonuses all intermediaries involved in bringing a product to market
d) An inefficient and outdated system of using intermediaries to bring products to market

13. Channel conflict means __________
a) Each member in the channel specialises in performing a narrow function
b) Disagreement among marketing channel members on goals and rules, i.e. who should do what and for what rewards
c) Disagreement among consumers on whether to patronise full service stores, outlet stores or mail order companies
d) Companies opt to bypass intermediaries in the marketing channel and sell directly to big consumers, depriving intermediaries of profits

14. In a vertical marketing network (VMN), __________
a) The channel consists of one or more independent producers, wholesalers and retailers. Each is a separate business seeking to maximise its own profits, at times even at the expense of other members
b) Producers, wholesalers and retailers act as a unified system
c) All stages of production and distribution are combined under single ownership and determined solely by the manufacturer.
d) Conflict is potentially greater than in a conventional marketing channel but profits are infinitely higher

15. The major marketing logistics networks (demand-chain) trade-offs include: ________
a) Order processing and warehousing
b) Inventory and transportation
c) Conversion lot quantity costs, order processing, warehousing, inventory management and transportation
d) Product, price, placement, promotion, process, people and physical evidence

16. Which of the following is NOT a service level offered by retailers?
a) Limited service
b) Full service
c) Quality service
d) Self-service

17. What is the name of the distribution channel that involves a single firm setting up two or more marketing channels to reach one or more customer segments?
a) Horizontal marketing network
b) Vertical marketing network
c) Both Hybrid marketing channels and Multichannel network
d) Multichannel networks

18. Which is not a role of a marketing channel?
a) Product development
b) Negotiation
c) Promotion
d) Physical Distribution

19. What is the title of the distributor who sometimes operates between wholesalers and smaller retailers?
a) Jobber
b) Agent
c) Broker
d) Manufacturer’s representative

20. What are the different types of service retailer?
a) Limited Service
b) Full Service
c) Self Service
d) All of the above

21. Logistics aims at
a) Management of synchronized flow of materials and services through materials management, manufacturing management and marketing functions with greater satisfaction to end consumer
b) Management of suppliers through efficient purchasing
c) Management of raw, intermediate and finished materials
d) Coordinated flow of finished goods to first level of customers

22. Real life inventory management is more complex because
a) Demand rate is not known nor it is constant
b) Lead time of suppliers is not known nor it is constant
c) Both of the above
d) None of the above

23. In the emerging fierce competition, retailers are becoming more powerful but
a) They do not want to hold more than the barest minimum inventory
b) Items should be in presentation form only
c) Vendors to manage inventories for them
d) All of the above

24. Concept of distribution centres under SCM is
a) An old concept of regional warehouses with a new name
b) Intended to reduce storage points in the distribution system
c) Designed to reduce variability in demand
d) In an extension of manufacturing and logistics downstream to save on costs and improve customer satisfaction

25. Distribution centres help to customise the products and services
a) At the downstream stage
b) At the midstream stage
c) At the upstream stage
d) None of the above

26. Transportation Management is
a) A small and insignificant part of SCM
b) Too specialised and should be managed separately
c) Does not affect customer service
d) Forms a major component of costs and should be synchronised to enhance customer satisfaction

27. Transportation Management under SCM should target
a) Continuous replenishment of products sold to end consumer
b) Selective outsourcing to facilitate coupling and docking downstream
c) Both of the above
d) None of the above

28. Excellence in distribution operations
a) Is value adding to supply chain
b) Improves accuracy of order fulfillment, quality in products and services
c) Both of the above
d) None of the above

29. Increasingly customers are demanding
a) Quality, price and credit terms
b) Prompt delivery and other post sale services
c) Both of the above
d) None of the above

30. Competition is currently revolving around
a) Products only
b) Bundle of services around of services around the product
c) The entire supply chain right up to the end consumer
d) None of the above

31. Customer service implies
a) Management of customer service after sales
a) Management of customer service during and after sales
b) Effective customer contact management before, during and after sales
c) None of the above

32. Satisfied customers benefit firms as
a) They help increase market share including word-of-mouth recommendations to new buyers and reduce costs of marketing and sales
b) They make it possible to charge premium prices over competitiors
c) Both of the above
d) None of the above

33. Customer service support is driven by
a) Changing customer expectations, proliferation of products and new technologies
b) Changing channels of customer support delivery
c) Both of the above
d) None of the above

34. Principle of postponement plays a significant role in reducing costs of SCM. Postponement is greatly facilitated by
a) Modular design of products
b) Modular design of process
c) Both of the above
d) None of the above

35. Integrated demand and supply chain management can deliver higher benefits if
a) Core process of demand chain and supply chain are integrated
b) Support infrastructure that facilitates integration of demand chain and supply chain is put in place
c) Both of the above
d) None of the above

36. Efficient Consumer Response (ECR) stands for fulfilling consumer expectations
a) Better
b) Faster
c) At lower cost
d) All of the above

37. Roots of ECR can be traced
a) Adopting Just-in-Time and Total Quality Management philosophy
b) Close collaboration, networking and sharing of business information with partners in the SCM
c) Both of the above
d) None of the above

38. ECR has been greatly facilitated by enabling technologies like
a) Electronic Data interchange, bar coding and data base maintenance
b) Electronic fund transfer and other financial transactions
c) Both of the above
d) None of the above

39. ECR stands for
a) New products and processes
b) New attitudes and behaviour
c) Both of the above
d) None of the above

40. ECR aims for
a) Removing negatives in supply chain and building off its strengths
b) Focusing on demand generation
c) True partnership across the firms in the supply chain
d) All of the above

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