International Marketing – Gilly, Cateora, Graham Chapter 15 Questions and Answers

International Marketing – Gilly, Cateora, Graham Chapter 15 Questions and Answers

  • Identify the accurate statements about a distribution process. (Check all that apply.

Commercial negotiations occur among procedures, middleman, and buyers.

Ownership or title is passed.

  • When a market has a traditional distribution structure, mass distribution and market penetration are not necessary, because

There is not enough product to meet customer demand

  • Throughout the world, traditional distribution channels are becoming more efficient, which has led to

A preference for self service

The rise of mass merchandising

The emergence of e-commerce and supermarkets

The introduction of direct marketing and discounting

  • True or false: Worldwide, retailing has been generally stagnant for the past couple of decades


  • The first people involved in the distribution channel process are the


  • Goods are sold and physically moved in

A distribution process

  • Identify the correct statements about a traditional distribution structure. (Check all that apply.)

The merchandise is sold locally, not nationally

The merchandise is usually sold to wealthy people.

A little amount of merchandise is available

This type of distribution structure creates a seller’s market

  • To improve the efficiency of their distribution systems, marketers around the world are experimenting with

Door to door selling

Selling via the internet

Selling via hypermarkets, shopping malls, and discount houses

Direct marketing

  • Employing home-country middlemen proves advantageous when companies

Have not previously competed very much in the global market

Want to participate in the global market without committing much money to effort

Are not making many sales globally.

  • The recent rapid change in retail markets around the world is apparently a result of

Economic development

  • The last people involved in the distribution channel process are the


  • Envy Corp., a textile company, launches a line of women’s wear that is sold in stores owned by the company. These stores are examples of

Manufacturer’s retail stores

  • Identify the features of export management companies. (Check all that apply.)

They are independent companies but answer directly to the manufacturers.

They handle international marketing for manufacturers that do not have large global sales revenues.

  • In a distribution structure, a limited amount of merchandise is controlled by

An importer

  • Home-country middlemen are also known as

Domestic middleman

  • Export management companies handle

Studying the market

Shipping of products to customers

Advertising and exhibiting the products

  • When stores are owned by manufacturers and used as channels of distribution, those stores are known as

Export management companies operate under the authority of the manufacturers as

Affordable autonomous marketing organizations

  • Marketing services are sometimes provided by individuals located in a producing firm’s home country. This arrangement is useful when

The seller does not want to invest the time and money required to develop a global marketing system

  • What are the advantages of working with export management companies? (Check all that apply.)

They help companies penetrate foreign markets at a relatively small cost.

They help companies avoid assigning their own employees and managers to foreign marketing efforts.

They are paid on commission

  • What do export management companies need to survive?

Immediate sales to earn them a commission.

  • A traditional distribution structure is also known as a(n) __________ distribution structure.


  • Trading companies in developed countries

Buy raw materials from developing countries.

  • Employing home-country middlemen proves advantageous when companies

have not previously competed very much in the global market.

are not making many sales globally.

want to participate in the global market without committing much money to the effort.

  • A multinational food and beverage company manufactures potato chips. On receiving positive feedback from consumers, it decides to launch a line of chip dip as well. This is an example of

Complementary marketing

  • Why do firms undertake piggyback arrangements? (Check all that apply.)

to enable their distribution systems to operate all year long

to offer more product lines

  • True or false: Export management companies do not rely on sales volume for their compensation.


  • Goods are collected, shipped, and sold from many countries by

Trading companies

  • Complementary marketing is also known as


  • People or firms that provide international selling services for manufacturers are known as

Manufactures export agents

  • Identify an accurate statement about piggyback arrangements.

Usually merchants buy the products and resell them at a profit.

  • Identify the disadvantages of working with export management companies. (Check all that apply.)

They usually cannot afford to invest enough money to achieve deep distribution of the product.

If the product is not making much money, the company sometimes fails to promote it aggressively

  • What are the advantages of using middlemen in foreign lands? (Check all that apply.)

They are better able to deal with difficulties arising from the distribution of products, funding, and foreign languages.

They help connect companies that make goods with the people who will buy them.

  • When a company wants to offer a wider selection of merchandise for its international marketing efforts, it sometimes adds products that work well with its original products. In these cases, the company is engaged in


Complementary marketing

  • What do manufacturers receive from manufacturer’s export agents?

Selling services

  • When companies use foreign-country middlemen,

international marketers achieve more control over their distribution systems.

  • Before choosing middlemen, a company should consider

markets that will be targeted, in specific countries and across broad regions.

how many people and how much money will be devoted to global marketing.

goals such as how much sales volume the venture needs to generate.

  • Identify the six C’s of channel strategy. (Check all that apply.)







  • Match the types of channel costs in the left column to the correct description in the right column.

Investment costs     – Money spent to set up a distribution channel

Costs of maintaining channels  – Money paid to the company’s sales crew or to middlemen as they market the company’s products

  • Identify a factor that reduces the amount of money a firm must invest in channel management.

Use of distributors

  • Firms must establish _____ before choosing channel middlemen.

Operational policies

  • Which of the following is not one of the six C’s of channel strategy?


  • Middlemen spend money (and therefore ultimately drive up the price of the merchandise) when

they advertise products locally.

they sell products as the representatives of the manufacturer.

they move and store merchandise.

  • Drew’s Corp., a baby-product manufacturing company, eliminated middlemen in its product distribution process. Instead, it entrusted the task to one of its managers. In this scenario, the company increased its

Control over channels

  • The largest investment of funds is required when a firm

Relies on its own sales force

  • When distribution channels are lengthened

control over promotion decreases.

control over price decreases.

control over outlet variety decreases.

control over volume decreases.

  • What are the benefits of obtaining full-market coverage? (Check all that apply.)

The company can claim a substantial share of the market.

The product can become so well known that most people in the market will recognize it.

  • When selecting a distribution channel, a company should consider

whether the product will require any sales service.

how much money the product is worth.

whether the product is apt to spoil easily.

whether the sale of the product will involve a complex procedure.

the product’s size.

  • Which of the following middlemen are likely to be loyal to their vendors? (Check all that apply.)



  • When distribution agreements are made with middlemen, firms must

specify what will be expected of the company and the middleman

  • In foreign countries, adequate market coverage may require

Changing the way products are distributed

  • True or false: Channel patterns are constant and seldom undergo changes.


  • When consumers stop buying a brand for a particular period of time, middlemen tend to

Soon stop selling those products

  • To ensure that middlemen will continue to be enthusiastic about selling its products, a company should

stay in touch via newsletters, for example.

handle disputes with tact.

offer sufficient financial compensation.

  • True or false: Exporters cannot dismiss distributors who fall short of sales minimums.


  • Parent companies exert control over middlemen by monitoring

sales volume.

advertising and profit.

prices and payment of bills.

coverage of market.

services offered.

  • What are the benefits of obtaining full-market coverage? (Check all that apply.)

The product can become so well known that most people in the market will recognize it.

The company can claim a substantial share of the market

  • It is particularly important for firms to maintain good rapport with their middlemen in countries where the most important cultural factor is


  • Identify the measures to manage middlemen’s activities. (Check all that apply.)



sending personnel from the company to visit the middlemen

  • Identify a factor that improves supply-chain management.

Online B2B marketing

  • The World Wide Web is used to sell industrial goods, in addition to consumer services and merchandise, via


  • True or false: A potential problem for a website designed for global markets is the different cultural reactions to colour.


  • Online B2B marketing helps

Increase inventory control

  • Logistics management involves the physical transportation of

inventory that is ready to ship to customers.

merchandise that is being processed.

raw materials.

  • True or false: Distributing goods via the Internet is a form of indirect selling


  • The combined costs of all facets of a physical distribution system are called the

Total cost

  •, an online store for gardening tools, launches a new version of its website in a different language. However, it displeases customers because the exact translations of certain phrases sound inappropriate. In this scenario, the e-vendor has overlooked

Culture norms

  • Identify an accurate statement about online B2B marketing.

It is cheaper way to process transactions

  • The total distribution process of an international trade channel is handled through

Logistics management

  • Identify the facets of a physical distribution system. (Check all that apply.

Plants and warehousing



Packaging of goods

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