5.01 Channels of Distribution

Which of the following is a benefit of channels of distribution:

• a. We can more easily obtain products from all over the world.

• b. Producers must spend more money.

• c. Retailers must spend more money.

• d. We spend more time looking for products we want.

Where does a channel of distribution begin?

• a. With the industrial user

• b. With the producer

• c. With the ultimate consumer

• d. With the intermediary

Which of the following is an example of an ultimate consumer:

• a. A teenager buying their first car

• b. A farmer buying seed for crops that will be sold at market

• c. A manager buying office supplies

• d. A restaurant owner buying a new oven for the restaurant's kitchen

Which of the following is an example of an industrial user:

• a. A parent buying a picture frame for their desk

• b. A hairstylist buying new scissors to perform haircuts

• c. A family buying a new home computer

• d. A teacher buying a book to read on vacation

Quality Distributors buys electrical equipment and supplies from ABC Electric and sells them to local electrical contractors. Quality Distributors is an example of a(n)

• a. retailer.

• b. intermediary.

• c. agent.

• d. producer.

Walmart, Domino's, and Avis Rent-a-Car are examples of

• a. agents.

• b. industrial distributors.

• c. retailers.

• d. wholesalers.

Top-Notch Wheels buys mountain bikes from The Great Colorado Mountain Bike Company and sells them to bike shops. Top-Notch Wheels is an example of a(n)

• a. agent.

• b. retailer.

• c. producer.

• d. wholesaler.

What type of intermediary would purchase baseball bats from one producer, mitts from another, and balls from still another and then sell an assortment to sporting goods stores?

• a. Agent

• b. Wholesaler

• c. Producer

• d. Retailer

Which of the following intermediaries never actually owns the products they promote and sell:

• a. Retailers

• b. Wholesalers

• c. Agents

• d. Industrial users

The use of intermediaries enables producers to make larger profits because intermediaries

• a. help reduce the per-unit costs of goods.

• b. enable producers to use direct distribution.

• c. increase the number of retailer-to-producer contacts.

• d. may sell more than the producer could sell on its own.