Term
|
Definition
| Intangible customer benefits produced by people or machines that cannot be separated from the producer. Service cannot be returned, nor tryed before bought. |
|
|
Term
| What is customer service? |
|
Definition
| Human or mechanical activities firms undertake to help satisfy customer's needs and wants. |
|
|
Term
| Why have economies of developed countries become increasingly dependant on services? |
|
Definition
1.) it is less expensive for firms to manufacture their products in less developed countries.
2.) household maintenance acivities. which many people performed by themselves in the past, have become quite specialized.
3.) people place a high value on convenience and leisure. |
|
|
Term
| What are the four core differences between services and goods? |
|
Definition
| Inseparable, Variable, Perishable, Intangible. |
|
|
Term
| What is meant by the term intangible? |
|
Definition
| Characteristic of a service that cannot be touched, tasted, or seen like a pure product.can be very difficult for marketers to determine what went wrong.A service cant be shown directly to potential customers, which also make it difficult to promote. |
|
|
Term
| service providers rely heavily on what? |
|
Definition
| on consumer perceptions of their integrity and trustworthiness. |
|
|
Term
| What is meant by inseparable? |
|
Definition
| Characteristic of a service produced and consumed at the same time. service and consumption are inseparable. |
|
|
Term
| What have healthcare providers found? |
|
Definition
| the more control they allow their patients to have in determining the course of treatment, the more satisfied those patients were. |
|
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Term
|
Definition
| Characteristic of a service whose quality may vary because it is provided by humans. |
|
|
Term
| Why is inferior service a big problem? |
|
Definition
| it cant be recalled, by the time the firm recognizes a problem, the damage has been done. |
|
|
Term
| How can marketers use the variable nature of services to their advantage? |
|
Definition
| By using a micromarketing strategy, ie: the geek squad. it is expensive to deliver though. Some service providers replace people with machines, which are good for simple transactions like getting cash. |
|
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Term
|
Definition
| characteristic of a service that cannot be stored for future use. |
|
|
Term
|
Definition
| When service fails to meet the expectations that customers have about how it should be delivered. |
|
|
Term
|
Definition
| Type of service gap; reflects the difference between customers' expectations and firm's perception of those expectations. |
|
|
Term
|
Definition
| type of service gap; difference between firm's service standards and actual service it provides to the customers. |
|
|
Term
| What is a communication gap? |
|
Definition
| The difference between service provided and service promised by the firm's promotion program. |
|
|
Term
| How can a firm reduce the knowledge gap? |
|
Definition
| They must understand customers expectations, by undertaking customer research and increase the interaction and communication between managers and employees. |
|
|
Term
| What are customer expectations based on? |
|
Definition
| their knowledge and experiences. |
|
|
Term
| What are some ways in which expectations might vary? |
|
Definition
| According to the type of service, or situation. |
|
|
Term
|
Definition
| customers perceptions of how well a service meets or exceeds their expectations. |
|
|
Term
| What are the 5 building blocks of service quality? |
|
Definition
1.) reliability- the ability to perform the service dependably and accurately
2.) responsiveness- the willingness to help customers and provide prompt service.
3.) assurance- the knowledge of and courtesy by employees and their ability to convey trust and confidence.
Empathy- the caring, individualized attention provided to customers.
Tangibles- the appearance of physical facilities, equipment, personnel, and communication materials |
|
|
Term
| What is the voice of customer program? |
|
Definition
| ongoing marketing research system that collects customer inputs and integrates them into managerial decisions. |
|
|
Term
| What is the zone of tolerance? |
|
Definition
| Are between customers expectations of desired service and minimum level of acceptable service; difference between what customers really want and what they will accept before going elsewhere. |
|
|
Term
| To define the zone of tolerance, firms ask a serious of questions about each service quality dimensions that relate to: |
|
Definition
1.) the desired and expected level of service for each dimension, from low to high.
2.) customers perceptions of how well the focal service performs and how well a competetive service performs, from low to high.
3.) the importance of each service quality dimension. |
|
|
Term
| Even if complaints are handled effectively to solve customer's problems... |
|
Definition
| the essence of the complaint is too often lost on managers. managers who make service quality decisions need to be on the front line and understand the service provided. |
|
|
Term
| What does the manager need to do when it comes to setting the service standard? |
|
Definition
| he needs to set an example of high service standards, which will permeate throughout the organization, and the employees must be thoroughly trained not only to complete their specific tasks but also in how to treat guests. |
|
|
Term
| to deliver consistently high quality service, what must firms do? |
|
Definition
| set specific, measurable goals based on customers expectations. to help ensure that quality, the employees should be involved in the goal setting. |
|
|
Term
| service providers take their cues from who? |
|
Definition
| from management. If managers strive for excellent service, treat their customers well, and demand the same attitudes from everyone in the organization, it is likely employees will do the same. |
|
|
Term
| the delivery gap is where ... |
|
Definition
| the rubber meets the road, where the customer directly interacts with the service provider. |
|
|
Term
| How can delivery gaps be reduced? |
|
Definition
| when employees are empowered to act in the customers' and the firms best interests and supported in their efforts so they can do their jobs effectively. technology can also be employed to reduce delivery gaps. |
|
|
Term
|
Definition
| in service delivery context, allowing employees to make decisions about service provision to customers. |
|
|
Term
| Why is empowerment important and why is it difficult? |
|
Definition
| empowerment becomes more important when the service is individualized. it is costly. |
|
|
Term
| What are the ways in which management needs to support the service provider. |
|
Definition
1.) managers and coworkers should provide emotional support to service providers by demonstrating a concern for their well being and standing behind their decisions.
2.) service providers require instrumental support - the systems and equipment- to deliver the service properly.
3.) the support that managers provide must be consitent and coherent throughout the organization.
4.) providing rewards to employees for excellent service. |
|
|
Term
| why is technology important in service providing and what are some benefits? |
|
Definition
it has become important for facilitating the delivery of services. it enables customers to buy more quickly, more easily and with more information.
it gives access to a wider variety of services, a greater degree of control by the customer over the services, and the ability to obtain info. management benefits through the increased efficiency and the competitor advantage over other firms.
it changes customer's perceptions. |
|
|
Term
| why do firms have difficulty controlling service quality? |
|
Definition
| it can vary from day to day. but they do have control over how the communicate their service package to their customers. |
|
|
Term
| how can the service gap be reduced? |
|
Definition
| by managing customer expectations. and promising only what you can deliver, or possibly even a little less. customers dont like surprises. |
|
|
Term
| what are three ways in which a firm can increase service recovery? |
|
Definition
1.) listening the the customers.
2.) resolving problems quickly
3.) providing a fair solution. |
|
|
Term
| when it comes to listening to a customer, what should s service provider do? |
|
Definition
| welcome the opportunity to be that sympathetic ear, listen carefully, and appear anxious to rectify the situation to ensure it doesnt happen again. |
|
|
Term
| what is distributive fairness? |
|
Definition
| customer's perceptions of the benefits received compared with the costs ( inconvenience or loss) resulting from a service failure. |
|
|
Term
| what is procedural fairness? |
|
Definition
| customer's perception of the fairness of the process used to resolve complaints about a service. |
|
|
Term
| the longer it takes to resolve a service failure.... |
|
Definition
| the more irritated the customer will become and the more people he or she is likely to tell about the problem. |
|
|
Term
| what do firms need to do to resolve a problem quickly? |
|
Definition
| firms need clear policies, adequate training for their employees, and empowered employees. |
|
|
Term
| what is the crest method, and what does it do? |
|
Definition
crest method refers to an acronym that when carefully implemented can help resolve service failures.
c: calm the customer by listening and empathizing.
r: repeat the problem heard
e: use empathy statements ie: i would feel
s: solve the problem
t: make a timely response. |
|
|
Term
|
Definition
| Overall sacrifice a consumer is willing to make, money, time, energy to acquire a specific product or service. |
|
|
Term
| A great but overpriced product can be judged as low in what? |
|
Definition
| value, and may not sell as well as an inferior but well priced item. |
|
|
Term
| A price set too low may signal what? |
|
Definition
| low quality, poor performance, or other negative attributes about the product or service. |
|
|
Term
| Every other element in the marketing mix might be perfect, but... |
|
Definition
| if the price isnt right, sales wont occur. |
|
|
Term
| Consumers use price to do what? |
|
Definition
| to judge the quality of a product or service. |
|
|
Term
| How should marketers view price? |
|
Definition
| a strategic opportunity to create value rather than as an afterthought to the rest of the marketing mix. |
|
|
Term
| What are the five c's of pricing? |
|
Definition
1.) company objectives
2.) customers
3.) costs
4.) competition
5.) channel members |
|
|
Term
| What is profit orientation? |
|
Definition
| Company objective implemented by focusing on target profit pricing, maximizing profits, or target return pricing. Ex comapany wide policy that all products must provide at least an 18 percent profit margin to reach a particular profit goal for the firm. |
|
|
Term
| What is target profit pricing? |
|
Definition
| Strategy implemented by firms with a particular profit goal; uses price to stimulate sales at a certain profit per unit. |
|
|
Term
| What is meant by maximizing profits? |
|
Definition
| An economically based pricing strategy that attempts to identify the price at which a product or service's profits are maximized. |
|
|
Term
| What is target return pricing? |
|
Definition
| strategy implemented by firms interested in the rate of profits relative to investments. designed to produce specific return on investment, usually expressed as percentage of sales. |
|
|
Term
| What is sales orientation? |
|
Definition
| Company objective based on the belief that increasing sales help the firm more than increasing profits. Ex: setting prices very low to generate new sales and take sales away from competitors, even if profits suffer. |
|
|
Term
| What is competitor orientation? |
|
Definition
| Company objective based on the premise that the firm should measure itself primarily against it's competition. ex: to discourage more competitors from entering the market, set prices very low. |
|
|
Term
| What is customer oriented? |
|
Definition
| Orientation that explicilty invoks the concept of customer value and sets prices to match consumer expectations. ex: target a market segment of consumers who highly value a particular product benefit and set prices relatively high ( reffered to as premium pricing) |
|
|
Term
| What is competitive parity? |
|
Definition
| strategy of setting prices similiar to those major competitors. |
|
|
Term
|
Definition
| competitor based pricing method; firm deliberately prices products above competitors to capture consumers who always shop for the best or for whom price does not matter. |
|
|
Term
| What is status quo pricing? |
|
Definition
| competitor-oriented strategy, firm changes prices only to meet those of competition. |
|
|
Term
|
Definition
| strategy of selling innovation at a high price that innovators and early adapters will pay to obtain it, then lowering the price to capture or skim the next most price sensitive segment. |
|
|
Term
| For price skimming to work... |
|
Definition
| the product or service must be percieved as breaking new ground in some way, offering consumers new benefits currently unavailable in alternative products. also competitors cannot be able to enter the market easily. a firm must consider the trade off between earning a higher price and suffering higher production costs. |
|
|
Term
| What is a market penetration pricing strategy? |
|
Definition
| pricing strategy that sets low initial price of new product or service to build sales, market share, and profits quickly. |
|
|
Term
| what is the experience curve effect? |
|
Definition
| drop in unit cost as accumulated volume sold increases. |
|
|
Term
| What is the most important of the 5 c's of price? |
|
Definition
| consumers; consumers want value, and price is half of the value of the equation. |
|
|
Term
|
Definition
| How many units of a product or service consumers demand during a specific period at different prices. |
|
|
Term
| What does knowing the demand curve help the firm do? |
|
Definition
| enables a firm to examine different prices in terms of the resulting demand and relative to its overall objective. |
|
|
Term
| What are prestige products or services? |
|
Definition
| Consumers purchase for status rather than functionality. |
|
|
Term
| What is the price elasticity of demand? |
|
Definition
| measures how changes in price affect quantity of product demanded; specifically, ratio of the percentage change in quantity demanded to the percentage change in price. |
|
|
Term
| what is the formula for price elasticity of demand. |
|
Definition
| % change in quantity demanded / % change in price. |
|
|
Term
|
Definition
| Market for a product or service that is price sensitive; relatively small change in price generate large changes in quantity demanded. or when the price when price elasticity of demand is less than -1, or a 1 percent decrease in price produces more than a 1 percent increase is sales. |
|
|
Term
| What is meant by inelastic? |
|
Definition
| Market for a product or service that is price insensitive; relatively small changes in price do not generate large changes in the quantity demanded. |
|
|
Term
| What is the income effect? |
|
Definition
| change in the quantity of a product demanded by consumers due to a change in their income. |
|
|
Term
| What is the substitution effect? |
|
Definition
| consumer's ability to substitute other products for the focal brand and increase price elasticity of demand for the focal brand. |
|
|
Term
| What is cross price elasticity? |
|
Definition
| Percentage change in demand for product A in response to percentage change in product B. |
|
|
Term
| What are complimentary products? |
|
Definition
| products whose demand curves relate positively, such that they rise or fall together in exact proportion. |
|
|
Term
| What are substitute products? |
|
Definition
| products for which changes in demand relate negatively; a percentage increase in quantity demanded for one means a percentage decrease in quantity demanded for the other. |
|
|
Term
| What is a reference price? |
|
Definition
| price against which buyers compare actual selling price of a product: facilitates evaluation processes. |
|
|
Term
| What is an external reference price? |
|
Definition
| higher price to which consumers can compare the selling price to evaluate a purchase. |
|
|
Term
| What is the internal reference price? |
|
Definition
| price information stored in the consumer's memory, used to assess a current price offering. |
|
|
Term
| What is everyday low pricing? |
|
Definition
| strategy to emphasize the continuity of retail prices somewhere between the regular, nonsale price and deep discount sales prices. |
|
|
Term
| What is cost based pricing? |
|
Definition
| pricing strategy that involves determining the costs of producing a product and adding a fixed amount to arrive at the selling price. |
|
|
Term
|
Definition
| costs, primarily labor and materials, that vary with production volume. |
|
|
Term
|
Definition
| costs that remain essentially at the same level, regardless of changes in the volume production. |
|
|
Term
|
Definition
| sum of variable and fixed costs. |
|
|
Term
| What is the break even analysis? |
|
Definition
| technique to examine relationships among cost, price, revenue, and profit over different production and sales to determine the break even point. |
|
|
Term
| What is the breakeven point? |
|
Definition
| the point at which the number of units sold generates enough revenue to equal total costs; at this point, profits are zero. |
|
|
Term
| What are the formulas for total variable cost, total cost, and total revenue |
|
Definition
tvc= variable cost x quantity
tc= fixed cost + tvc
tr= price x q |
|
|
Term
| what is the formula for the break even point? |
|
Definition
| fixed costs/ contribution per unit |
|
|
Term
| how would you determine how many units you need to sell to generate a certain level of profit? |
|
Definition
| ( fixed costs + target profit)/ contribution per unit. |
|
|
Term
| What is the contribution per unit? |
|
Definition
| price less variable cost per unit. used to determine the break even point in units. |
|
|
Term
| What is oligopolistic competition? |
|
Definition
| when a few firms dominate a market. |
|
|
Term
|
Definition
| when two or more firms compete primarily by lowering prices. |
|
|
Term
| What are some limits to the break even analysis? |
|
Definition
1.) it is unlikely that the price is specific for every product.
2.) prices often get reduced as quanitity increases.
3.) break even cant determine how many prodcts will be sold at a given price. |
|
|
Term
|
Definition
| practice of colluding with other firms to control prices. |
|
|
Term
|
Definition
| many firms sell closely related but not homogenous products; products may be viewed as but are not perfect substitutes. |
|
|
Term
| What are the three types of competition? |
|
Definition
| monopoly, pure, or oligopoly. |
|
|
Term
| What is pure competition? |
|
Definition
| When different companies sell commodity products that consumers perceive as substitutable; price usually set according to the laws of supply and demand. |
|
|
Term
|
Definition
| employs irregular but not neccesarily illegal methods; legally circumvents authorized distribution channels to sell goods at prices lower than those inteded by the manufacturer. |
|
|
Term
|
Definition
| pattern of buying both premium and low-priced merchandise or patronizing both status- and price oriented retailers. |
|
|
Term
| What are two interrelated trends that have merged to impact pricing decisions. |
|
Definition
| increase in consumer's disposable inome and status consciousness. |
|
|
Term
| true or false, the economic enviroment at local, regional, national and global levels influence pricing. |
|
Definition
|
|
Term
|
Definition
| consumer pricing tactic to build store traffic by aggressively pricing and advertising regularly purchased items at or just above the store's cost. |
|
|
Term
| whats loss leader pricing? |
|
Definition
| extends leader pricing by lowering the price below the store's cost. |
|
|
Term
|
Definition
| deceptive practice of attracting customers with a low advertised price ( the bait ) then pressuring them to purchase a higher priced model ( the switch ) |
|
|
Term
|
Definition
| practice of setting very low prices with the intent to drive competitors out of business; illegal under both the sherman act and the FTC act. |
|
|
Term
| what is price discrimination? |
|
Definition
| practice of selling the same product to different resellers or ultimate consumers at different prices; some forms are illegal. |
|
|
Term
| What is a quantity discount? |
|
Definition
| pricing tactic offering a reduced price based on amount purchased; the more purchased, the higher the discount and the greater the value. |
|
|
Term
| What is supply chain management? |
|
Definition
| Set of approaches and techniques to integrate supply chain members into a seamless value chain to distribute merchandise appropriately and minimize system costs with necessary service levels. |
|
|
Term
|
Definition
| Firms engaged in buying, taking, storing, and physically handling goods in large quantities, the reselling ( in smaller quantities) to retailers or users. |
|
|
Term
| What is the marketing channel? |
|
Definition
| Institutions that transfer ownership of ad move goods from the point of production to the point of consumption; all institutions and marketing activities in the marketing process. |
|
|
Term
| What is logistics management? |
|
Definition
| integration of actvities for planning, implementing, and controlling efficient flow of raw materials, in process inventory, and finished goods from the point of origin to consumption. |
|
|
Term
| Are marketing channel management, supply chain management, and logistics management the same or different? |
|
Definition
| Marketing channel management traditionally has been the responsibility of marketing departments, under the direction of a marketing vice president. Logistics was traditionally the responsibility of operations, under a vice president of operations. Although their goals were similiar, they often saw solutions differently. Supply chain management takes a systemwide approach so it includes both channel management and logistics. |
|
|
Term
| Why dont people buy directly from the wholesaler? |
|
Definition
| It would be inconvenient, each member of the supply chain adds values. |
|
|
Term
| true or false, supply chain management doesnt streamline distribution. |
|
Definition
|
|
Term
| What is a distribution center? |
|
Definition
| facility for the receipt, storage, and redistribution of goods to stores or customers, operated by retailers, manufacturers or distribution specialists. |
|
|
Term
| What is the universal product code ( UPC )? |
|
Definition
| black and white bar code found on most merchandise. |
|
|
Term
| What are the five interrelated activities that emerge in supply chain management? |
|
Definition
1.) making info flow
2.) making merchandise flow
3.) managing inventory
4.) designing the supply chain
5.) managing the relationships among supply chain partners. |
|
|
Term
| How does a supply chain work in terms of making information flow? |
|
Definition
Flow 1 ( customer to store ): the sales associate at best buy scans the UPC tag, the customer gets a receipt.
Flow 2 ( store to buyer): the point of sale terminal records the purchase information and electronically sends it to the buyer at best buys corporate office. the sales info is incorporated into an inventory management system to aid in planning future purchases and promotions.
flow 3 ( store to manufacturer): the purchase information from each best buy store is typically aggregated by the retailer as a whole, which creates an order for new merchandise and sends it to sony. the buyer at best buy may also communicate directly with sony to get info and negative prices, shipping dates, promotional events, or other merchandise related issues.
flow 4 ( store to manufacturer) : if the merchandise is recorded frequently, the order process can become automatic and virtually bypass the buyer.
flow 5 ( store to distribution center): stores also communicates with the best buy distribution center to coordinate deliveries and check inventory status. |
|
|
Term
| What is electronic data interchange? |
|
Definition
| computer to computer exchange of business documents from a retailer to a vendor and back. |
|
|
Term
| what is an advanced shipping notice? |
|
Definition
| electronic document suppliers send to retailers before shipment, detailing what to expect in the shipment. |
|
|
Term
|
Definition
| secure communication system contained within one company, such as between the firms buyers and distribution centers. |
|
|
Term
|
Definition
| collaborative network that uses internet technology to link businesses with suppliers, customers, or other businesses. |
|
|
Term
| what is collaboration, planning, forecasting, and replenishment? |
|
Definition
| inventory management system that uses electronic data interchange through which a retailer sends sales info to a manufacturer. |
|
|
Term
|
Definition
| person who coordinates deliveries to distribution centers. |
|
|
Term
| What is meant by recieving? |
|
Definition
| process of recording the receipt of merchandise as it arrives at a distribution center or store. |
|
|
Term
|
Definition
| process of verifying goods upon receipt to ensure they arrived undamaged and match the merchandise ordered. |
|
|
Term
| what are the different kinds of merchandise flow in terms of best buy? |
|
Definition
1.) from sony to best buy's distribution centers
2.) from sony directly to stores.
3.) If the merchandise goes through distribution centers, it is then shipped to stores.
4.) and then to the customer. |
|
|
Term
| What is radio frequency identification? |
|
Definition
| tiny computer chips that automatically transmit all the information about a container's contents or induvidual products. |
|
|
Term
| What is a traditional distribution center? |
|
Definition
| warehouse in which merchandise unloaded from trucks is placed on racks or shelves for storage. |
|
|
Term
| What is a cross docking distribution center? |
|
Definition
| center to which vendors ship merchandise prepackaged and ready for sale; merchandise moves from receiving dock to the shipping dock. |
|
|
Term
| What is floor-ready merchandise? |
|
Definition
| merchandise ready to be placed on the selling floor immediately. |
|
|
Term
| what is ticketing and marking? |
|
Definition
| creating a price and identification labels and placing them on the merchandise. |
|
|
Term
| Most modern distribution centers are neither... |
|
Definition
| pure warehouse nor pure cross-docking systems but instead combine the two. |
|
|
Term
| no matter how good a sales forecasting system may be... |
|
Definition
| sometimes the merchandise arrives before it is needed in the stores. In these cases, the retailer must have a system to store the merchandise temporarily. |
|
|
Term
| shipping merchandise to stores is quite complex when... |
|
Definition
| it is a multistore chain. |
|
|
Term
| What is the just in time inventory system? |
|
Definition
| Inventory management systems that deliver less merchandise more frequently; the firm gets merchandise just in time to use in manufacture or sale; also known as quick response systems in retailing. |
|
|
Term
| what is meant by quick response |
|
Definition
| retailing inventory management system; merchandise received just in time for sale when the customer wants it. |
|
|
Term
|
Definition
| having enough inventory to satisfy customer demands with not having more than they need. |
|
|
Term
|
Definition
| amount of time between the recognition that an order needs to be placed and the arrival of the needed merchandise at the seller's store, ready for sale. |
|
|
Term
| what are two benefits of a JIT system? |
|
Definition
| reduced lead time, and increased product availability and lower inventory investment. |
|
|
Term
| What are some costs of a JIT system? |
|
Definition
| the logistics function becomes much more complicated with more frequent deliveries. Require a strong commitment by the firm and its vendors to cooperate, share data, and develop systems like EDI and CPFR. require financial and psychological support. |
|
|
Term
| what are supply chains composed of? |
|
Definition
| various entities that are buying, such as retailers or wholesalers; selling, such as manufacturers or wholesalers; or helping facilitate the exchange, such as transportation companies. |
|
|
Term
| Each member of the supply chain... |
|
Definition
| performs a special role. if one member believes that another isnt doing its job correctly or efficiently, it usually can replace that member. |
|
|
Term
| when choosing retailers to whom to sell, the manufacturer should consider what? |
|
Definition
| where the end customer expects to find the product, as well as some important retailer characeristics. |
|
|
Term
| a key part of any strategy is to |
|
Definition
| determine customer expectations. from a retailers perspective, it is important to know from which manufacturers want to buy. manufacturers in contrast need to know where their target market customers expect to find their products and those of their competitors. |
|
|
Term
| the larger and more sophisticated the channel member... |
|
Definition
| the less likely that it will use supply chain intermediaries. |
|
|
Term
| What is distribution intensity? |
|
Definition
| number of supply chain members used at each level of the supply chain |
|
|
Term
| what is intensive distribution |
|
Definition
| strategy designed to get products into as many outlets as possible. |
|
|
Term
| what is exclusive geographic territories |
|
Definition
| territories granted to select retail customers by a manufacturer in an exclusive distribution strategy; no other customers can sell the brand in these areas. |
|
|
Term
| What is selective distribution? |
|
Definition
| between intensive and exclusive distribution strategies; uses a few selected customers in a territory. |
|
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Term
| supply chain conflict, what is it? |
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Definition
| when supply chain members are not in agreement about goals, roles, or rewards. |
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Term
| what are two outcomes of supply chain conflict? |
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Definition
| either a stronger partnership, or the two firms no longer do business. |
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Term
| what are the two non mutually exclusive ways to manage a supply chain? |
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Definition
| coordinate the channel using vertical marketing system or develop strong relationships with supply chain partners. |
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Term
| when is supply chain conflict more pronounced? |
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Definition
| when supply chain members are indepedant entities. |
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Term
| What is a independant ( conventional) supply chain? |
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Definition
| Loose coalition of independantly owned and operated supply chain members that attempt to satisfy their own objectives and maximize their own profits often at the expense of other members. |
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Term
| What is vertical marketing system? |
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Definition
| supply chain in which members act as a unified system; three types; administrated, contractual, and corporate. |
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Term
| What is administered vertical marketing system? |
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Definition
| supply chain without common ownership or contractual relationships; dominant channel member controls the channel relationship. |
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Term
| what is contractual vertical marketing system? |
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Definition
| independant firms at different levels of the supply chain joined through contracts to obtain economies of scale and coordination and reduce conflict. |
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Term
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Definition
| Contractual agreement between franchisor and franchisee; franchisee operates a business using a name and format developed and supported by frachisor |
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Term
| What is corporate vertical marketing system? |
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Definition
| system in which parent company has complete control and dictates supply chain priorities and objectives; parent may own manufacturing and/or retail facilities |
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Term
| what does a person do if they want to be a franchisee and what are some benefits? |
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Definition
| the franchisee pays a lump sum plus a royalty on all sales in return for the right to operate a business in a specific location. it is a mutual benefit. franchisee wants to work hard and avoids a lot of start up costs, franchisor get royalties. |
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Term
| What is a strategic relationship? |
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Definition
| committed, long term supply chain relationship; requires mutual trust, open communication, common goals, and credible commitments. |
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Term
| What do successful strategic relationships require? |
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Definition
| mutual trust, credible commitment, common goals, and open communication. |
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