Deck 15: Product Development and Supply Chain Management

Question 1

Celestina Pugliese, creator of Ready Check Glo, felt her product served an overlooked market.

Answer 1

False

Question 2

In the development of the physical product stage of the new product development process, new products are analyzed and ideas that fail to show possible profitability are discarded.

Answer 2

False

Question 3

All small firms want to grow.

Answer 3

False

Question 4

A bed and breakfast inn that adds a restaurant that is open to the public is an example of unrelated product offerings.

Question 5

A small firm's special "signature" is called a logo.

Question 6

Because growth in sales is perceived as good for business, no changes will be needed in personnel, operations, or management style.

Question 7

Packaging has very little to do with increasing the value of the total product by creating a distinctive impression.

Question 8

Product testing is the last step in the new product development process.

Question 9

It is important that small firms gain a competitive advantage that cannot be quickly imitated.

Question 10

The product life cycle and competitive advantage life cycle differ in that the product life cycle reflects the sales and profit trend for a specific product or service, whereas the competitive advantage life cycle is based on the competitive edge of the company overall and can influence the sales of multiple products or services.

Question 11

Strategies for goods marketing and services marketing are essentially identical.

Question 12

Labeling information can be limited to the minimum legal requirements because it will put your company at a disadvantage.

Question 13

If inventory needs grow with higher sales, the increase in accounts receivable will cover this cost.

Question 14

Trademark and service mark are legal terms indicating the exclusive right to use a brand to represent products and services, respectively.

Question 15

Small firms develop significantly more innovations than large companies.

Question 16

In small businesses, new product development is best handled through a rigid, structured process.

Question 17

Innovative packaging is often the deciding factor for consumers.

Question 18

A brand includes the verbal and/or symbolic means of identifying a product.

Question 19

A growth trap occurs when a company needs cash faster than can be generated in profits.

Question 20

During the competitive advantage life cycle, firms can exploit a competitive advantage during the develop stage.

Question 21

A direct channel of distribution is one that involves only one intermediary.

Question 22

Annabelle's company makes pottery. She would like to expand her business and is looking for ideas. Which of the following would you advise her to do?

A) Think outside the box; go into a completely different line of products.
B) Pursue innovation that customers will perceive as adding excitement to their lives.
C) Base innovative efforts on her experience.
D) Focus on products or services offered by her largest competitors.

Question 23

Physical distribution of products includes only transportation.

Question 24

If a firm extends a janitorial cleanser from the industrial market to reach the home market, it is following a one product/multiple markets strategy.

Question 25

Thanks to the national press, Wonderful Gifts has had 100 percent more orders placed in this quarter than in the last quarter. The company could be caught in a _____ if proper planning does not occur.

A) growth net
B) growth trap
C) profit net
D) profit trap

Question 26

Distribution is essential for tangible products, but not for intangible products.

Question 27

Attorneys are rarely used by entrepreneurs when conducting a trademark search.

Question 28

Channel management is synonymous with the term logistics.

Question 29

A garden center selling two varieties of mint plant has one product item in two product lines.

Question 30

A utility patent covers the appearance of a product and its inseparable parts.

Question 31

The three main considerations in evaluating a channel of distribution are costs, coverage, and customer service.

Question 32

Successful growth

A) happens on its own.
B) occurs only when a number of factors are carefully considered and well managed.
C) should be easy if the owner has the correct management style.
D) will keep most business functions the same, just larger in scope.

Question 33

Which of the following statements is true about company growth?

A) Successful growth occurs on its own.
B) A high-growth firm's need for additional financing may exceed its available resources, even though the venture is profitable.
C) Inventory needs will increase while account receivables will decrease with growth.
D) While rapid growth may stress personnel, the increase in pay will be sufficient.

Question 34

Using 3PLs is considered more cost effective by many small businesses because it allows them to focus on their primary operations and outsource the accounting challenges to another company.

Question 35

Which of the following statements is correct concerning the role of innovation for small businesses?

A) Fortune magazine reports that 93 percent of company founders indicated that their business turned out to be nothing like their original venture concept.
B) Studies have shown that small entrepreneurial firms produce 95 percent as many innovations per employee as large firms.
C) According to Clayton Christensen, 60 percent of all new products end up failing or performing well below expectations.
D) Small entrepreneurial firms produce twice as many innovations per employee as large firms.

Question 36

Trade dress describes those elements of a firm's distinctive operating image that are specifically protected under a trademark, patent, or copyright.

Question 37

Distribution includes only the physical movement of products.

Question 38

According to the Food and Drug Administration regulations, food products must have a standard nutrition label listing the amounts of calories, fat, salt, and nutrients in the product.

Question 39

Shippers that own their own means of transport are called private carriers.

Question 40

Delivery terms include paying the freight costs, selecting the carriers, bearing the risk of damage in transit, and selecting the modes of transport.

Question 41

PepsiCo produces and distributes products under the brand names Pepsi, Quaker, Frito-Lay, and many others. This collection of product lines within PepsiCo's ownership and control is referred to as the

A) product depth.
B) product accumulation.
C) product line consistency.
D) product mix.

Question 42

A sustainable competitive advantage is

A) rarely appreciated by the firm's owners.
B) of little consequence to profitability.
C) an idealized position that is unachievable in reality.
D) a value-creating industry position that is likely to endure over time.

Question 43

Joe has redesigned an app that helps businesses organize their taxes after a rival gained market share. The IRS and the Society of Certified Public Accountants have said the app meets tax standards. The app would be considered a(n)

A) sustainable competitive advantage.
B) strategic alliance.
C) competitive adjustment.
D) business process reengineering.

Question 44

High-performing companies

A) adjust strategies for changing customer needs before rivals.
B) downgrade capabilities as competitive advantages move into the decline stage.
C) hire people to drive new growth once the growth is identified.
D) All of these are completed by high-performing firms.

Question 45

If a small firm is to maintain its performance over time, it is most essential to

A) continue to reinvent itself.
B) extend the competitive advantage of the firm.
C) replicate the strategies that have led to success in the past.
D) retain the personnel who made the firm successful in the first place.

Question 46

Products must be carefully analyzed in terms of financial considerations in the _____ stage of the new product development process.

A) business analysis
B) idea accumulation
C) product testing
D) development of the physical product

Question 47

The profit curve is the lowest in which of the following stages of the product life cycle?

A) Decline
B) Growth
C) Introduction
D) Maturity

Question 48

To maintain performance, a small business must launch a new competitive advantage

A) and keep that competitive advantage alive.
B) and make adjustments to that competitive advantage over time.
C) that causes rival firms to respond.
D) before the current strategy has run its course.

Question 49

Before a company's competitive advantage moves into the decline stage, it should

A) invest resources to develop a competitive advantage.
B) continue deploying the competitive advantage as long as it can.
C) slow the decline as much as possible.
D) implement previously developed plans for the hidden curves.

Question 50

Carrigan has just launched his new business. He has great plans for expansion later, but the most appropriate and effective product strategy to use in this stage of his small business is the _____ product strategy.

A) one product/one market
B) one product/multiple markets
C) multiple products/one market
D) The strategy depends on the product or service.

Question 51

Judy is opening a small business that will produce high-quality paper products and has decided to place a green pine tree on all product boxes and on the sign outside the facilities to symbolize the business. At this point, the symbol is an example of a

A) brandmark.
B) brand name.
C) service mark.
D) trademark.

Question 52

The product life cycle, as opposed to the competitive advantage life cycle,

A) helps an entrepreneur to visualize the sales and profits of a product from the time it is introduced until it is no longer on the market.
B) details when a strength can be used in the market and when not to attack a rival.
C) reflects sales trends for the company's multiple products or services.
D) is based on the overall sales of the total product or service line.

Question 53

When a product mix has more product lines, it has greater

A) breadth.
B) consistency.
C) depth.
D) lines.

Question 54

Arden has designed an artistic symbol to complement his product's name to assist customers in identifying his product. These symbols are commonly referred to as

A) brand.
B) trademark.
C) service mark.
D) trade dress.

Question 55

Which of the following brands generates trust in the minds of buyers by conveying to them a sense of happiness?

A) Amazon
B) Apple
C) Nordstrom
D) Coca-Cola

Question 56

The business analysis stage of the new product development process is critical because

A) one to three years may pass before profits are realized on the sale of a new product.
B) it is hard to attract the 10 percent of the total market that is needed for a new product success.
C) products often fail in laboratory and marketing testing.
D) All of these support the importance of the business analysis stage.

Question 57

Beatrice is contemplating whether to offer a warranty on her product. She should remember that warranties are important for products

A) that are relatively inexpensive.
B) that are frequently purchased.
C) that are relatively complex to repair.
D) regardless of how they are positioned in the market.

Question 58

Bagels Bagels Bagels, a small breakfast bagel bakery, has expanded into sandwiches for lunch using bagels. It is now employing a _____ product strategy.

A) one product/one market
B) one product/multiple markets
C) modified product/one market
D) modified product/multiple markets

Question 59

A legal term indicating that a firm has exclusive rights to use a brand to represent a product is a

A) copy mark.
B) trademark.
C) service mark.
D) trade dress.

Question 60

Furniture Shine is introducing an improved version of its existing wax targeted to owners of antiques. The firm has decided to leave the original wax in the mix aimed toward residential owners. Furniture Shine is employing a _____ product strategy.

A) multiple products/one market
B) multiple products/multiple markets
C) modified product/one market
D) modified product/multiple markets

Question 61

Love Languages is introducing an improved version of its tutoring targeted to students who want more in-depth assistance using an online format. The company has decided to continue to offer its original tutoring package and aim the new product at the original target market; therefore, it is employing a _____ product strategy.

A) multiple products/one market
B) multiple products/multiple markets
C) modified product/one market
D) modified product/multiple markets

Question 62

Franklin sells his product in a brick-and-mortar store and online. Franklin is using

A) channel integration.
B) dual distribution.
C) intermediary replication.
D) multiple distribution.

Question 63

Cooking for Collin, a small manufacturer of holiday cakes, sells its product through independent retailers and mail-order marketing. Cooking for Collin is relying on a(n)

A) direct channel of distribution.
B) indirect channel of distribution.
C) dual distribution channel.
D) multiple-outlet distribution channel.

Question 64

The activities involved in physically moving a product are called

A) channel management.
B) channel of distribution.
C) logistics.
D) supply chain management.

Question 65

Which of the following intermediaries take ownership of the goods they distribute?

A) Agents
B) Brokers
C) Merchant middlemen
D) Supply chain managers

Question 66

How can a successfully growing firm fall into a growth trap?
How can a successfully growing firm fall into a growth tra

Question 67

Patricia has developed a new product that she would like to patent and produce. What can she do to reduce the risk of failure?

Question 68

A copyright provides protection for the duration of the creator's life, plus

A) 25 years.
B) 70 years.
C) 75 years.
D) 100 years.

Question 69

Eugenie has written a poem that she plans to print inside the greeting cards she will publish. Her work is automatically protected, but which of the following should Eugenie include on the back of her greeting cards?

A) The symbol ©
B) The date the work was published
C) The name of the copyright owner's company
D) A listing of all other copyrights held by the owner

Question 70

Buzz-Buzz Express is a small firm that sells honey bees domestically. Once purchased, the bees are flown to the purchaser using FedEx. Buzz-Buzz Express uses a

A) common carrier.
B) public carrier.
C) private carrier.
D) contract carrier.

Question 71

Both the physical movement of products and the establishment of intermediary relationships to support such movement are included in

A) channels.
B) distribution.
C) intermediaries.
D) logistics.

Question 72

Erica has registered protection for 20 years that covers a new process she has designed. Erica owns a

A) design patent.
B) plant patent.
C) utility patent.
D) trademark.

Question 73

Compare innovation in small businesses to innovation in large firms. Provide some examples of successful innovations by small entrepreneurial firms.

Question 74

The three main considerations in evaluating a channel of distribution are

A) costs, coverage, and control.
B) costs, coverage, and compatibility.
C) coverage, control, and compatibility.
D) costs, control, and compatibility.

Question 75

Small businesses should view distribution costs as

A) prohibitive.
B) sunk costs.
C) an investment.
D) a necessary evil.

Question 76

Intermediaries exist because

A) they provide more efficient means of distribution than the product producer.
B) they are able to reach geographic areas with much less expense.
C) they have lower risk levels since they don't have ownership of the goods.
D) they specialize in products for specific customer needs.

Question 77

Since Love Languages has decided to sell its tutoring service on DVDs through an online site as well as the traditional format of personal tutors, it is relying on a(n)

A) direct channel of distribution.
B) indirect channel of distribution.
C) dual distribution channel.
D) multiple-outlet distribution channel.

Question 78

A product strategy that includes adding an unrelated product to the mix

A) can be more challenging to manage.
B) is often used by small businesses.
C) will likely determine the future direction of the firm.
D) is encouraged, as long as it represents no more than half of the firm's product offerings.

Question 79

The distinctive operating image of a product, including features such as size, shape, color or color combinations, texture, graphics, or even particular sales techniques, can be protected

A) by copyright.
B) by patent.
C) as trade dress.
D) as a registered concept.

Question 80

When Gavin sells his product to _____, the storage function is transferred to the intermediary.

A) agents
B) brokers
C) common carriers
D) wholesalers