Quiz 15: Global Logistics and Distribution

In global logistics and distribution, Coca-Cola's success relies largely on its global distribution arm, _____, the world's largest bottler group. A)Coca-Cola Enterprises B)Coca-Cola Network C)Coca-Cola Web D)Coca-Cola Team E)Coca-Cola Trucking Co.

According to the textbook, which of the following famous business thinkers characterized logistics as being "the darkest continent of business?" A)Philip Kotler B)Stephen Covey C)Michaele Porter D)Peter Drucker E)Tom Peters

As firms start operating on a global basis, _____ need to manage the shipping of raw materials, components, and supplies among various manufacturing sites at the most economical and reliable rates. A)human resource managers B)logistics managers C)operations managers D)outsourcing managers E)information technology managers

In 2017, the total logistics cost represented about 7.7 percent of the GDP in the _____. A)U.S. B)Ireland C)Portugal D)Belgium E)Romania

_____ transportation refers to the seamless transfer of goods from one mode of transportation (such as an aircraft) to another (such as a ship) and vice versa without the hassle of unpacking and repackaging of goods to suit the dimensions of the mode of transportation being used. A)Dual shipping B)Bi-modal C)Intercontinental D)Dual-basic E)Intermodal

_____ refers to the means of keeping continuous tabs on the exact location of the goods being shipped in the logistics chain. A)Data processing B)Messaging service C)Tracking technology D)Computerized messaging E)Hybrid technology

With electronic tracking technology, shippers are able to quickly react to any disruption in the shipments because the shipper knows where exactly the goods are in real time and: A)labor can be adjusted accordingly. B)the alternative means can be quickly mobilized should problems develop. C)costs can always be evaluated. D)losses are rare. E)customer service is now at a premium.

_____ is defined as the design and management of a system that directs and controls the flows of materials into, through and out of the firm across national boundaries to achieve its corporate objectives at a minimum total cost. A)Global goods flow B)Global distribution C)Global logistics D)Global wholesaling E)Global shipping

Global logistics encompasses: A)advertising and personal selling. B)purchasing and manufacturing. C)materials management and trucking. D)materials management and physical distribution. E)pricing and manufacturing.

_____ refers to the inflow of raw materials, parts, and supplies in and through the firm. A)Global logistics B)Physical distribution C)Materials management D)Purchasing processes E)Global distribution

The global logistics process begins with which of the following? A)materials management B)processing and assembly C)physical distribution D)raw materials, components, and supplies E)finished products ready for shipment

When raw materials, components, and supplies are converted or manipulated for processing and assembly by the firm, the process is monitored and controlled by the _____ function of the firm. A)physical distribution B)purchasing C)intermodal transportation D)materials handling E)materials management

_____ refers to the movement of the firm's finished products to its customers, consisting of transportation, warehousing, inventory, customer service/order entry, and admission. A)Physical distribution B)Purchasing C)Intermodal transportation D)Global logistics E)Materials management

All of the following are activities that occur during physical distribution except: A)transportation B)warehousing C)inventory D)order entry E)promotion and advertising

With respect to distribution costs, a geographically large country such as the United States will normally incur more _____ costs than in smaller countries. A)transportation, insurance, and inventory B)warehousing, customer service/order entry, and general administration C)transportation and inventory D)materials handling E)warehousing and transportation

Which of the following factors contribute significantly to the increased complexity and cost of global logistics as compared to domestic logistics? A)domestic intermediaries B)service C)purchasing D)exchange rate fluctuation E)materials handling

All of the following factors contributed significantly to the increased complexity and cost of global logistics as compared to domestic logistics except: A)exchange rate fluctuation. B)distance. C)domestic intermediaries. D)foreign intermediaries. E)negotiations with government officials and distributors.

In the mid-1990s, the U.S.dollar depreciated while the Japanese yen soared in value.Honda found that it was much cheaper to ship its Accord models to Europe from its Ohio plant than from Japan.This could most accurately be classed as a move made because of problems or opportunities with: A)distance. B)logistics. C)exchange rate fluctuations. D)foreign intermediaries. E)domestic intermediaries.

The bulk of international trade is handled by _____. A)ocean shipping B)air transport C)trucking services D)railroads E)inland waterways

The most important factors in determining an optimal mode of transportation for foreign markets are the value-to-volume ratio, perishability of the product, and: A)the cost of transportation. B)intermodal ratio. C)total cost ratio to inventory and warehousing expense. D)the cost of insurance. E)the distance to speed relationship.

All of the following are important factors in determining an optimal mode of transportation to be used in foreign markets except: A)the cost of transportation. B)the value-to-volume ratio. C)the perishability of the product. D)obsolescence along the product life cycle. E)the cost of insurance.

The _____ is determined by how much value is added to the materials used in the product. A)perishability of the product B)cost of transportation C)the cost of insurance D)the value-to-volume ratio E)the intermodal ratio

The _____ of the product refers to the quality degradation over time and/or product obsolescence along the product life cycle. A)perishability B)cost of transportation C)cost of insurance D)value-to-volume ratio E)intermodal ratio

The primary forms of ocean shipping include all of the following except: A)liner service B)bulk shipping C)tanker shipping D)irregular runs E)FedEx surface

If a product were to be categorized as being heavy, bulky, and nonperishable, probably the best form of global shipping would be: A)ocean shipping B)air freight C)truck D)rail E)barge

If a company wished to ship semiconductor chips abroad, they would probably choose: A)ocean shipping B)air freight C)truck D)rail E)barge

The traditional logistics strategy involves _____ based on forecasting and inventory speculation. A)supply and demand B)anticipatory demand management C)inventory volume equations D)purchasing ratios E)microeconomic principles

Information technology, electronic data interchange, and intermodal transportation have made _____ a reality in physical distribution. A)low cost transportation B)a "no returns" policy C)ultimate distribution service D)just-in-time delivery E)accurate purchasing management

Multinational corporations can use _____ as a strategic tool in dealing with currency fluctuations and as a hedge against inflation. A)buying power B)just-in-time management C)just-in-time delivery D)purchasing management E)inventory

By increasing _____ before imminent depreciation of a currency instead of holding cash, the firm may reduce its exposure to currency depreciation losses. A)buying power B)plant and equipment C)trucks D)materials handling equipment (such as forklifts) E)inventory

_____ inventories also provide a hedge against inflation because the value of the goods/parts held in inventory remains the same compared to the buying power of local currency. A)High-tech B)Low-tech C)High D)Low E)None of the above

_____ refers to coordinating production and distribution across geographic boundaries. A)Rationalization B)Utility management C)Physical distribution management D)Logistical integration E)Logistic modeling

_____ means reducing resources to achieve more efficient and cost-effective operations. A)Rationalization B)Utility management C)Physical distribution management D)Logistic integration E)Logistic modeling

Another profound change in the last decade is the proliferation of _____. A)IT warehouses B)e-commerce C)information technology D)global shipping traffic E)global air traffic

The trend toward third-party logistics is a result of the _____ and the _____. A)internet, enterprise resource planning B)internet, technology simulations C)internet, customer relationship management D)internet, intranet E)none of the above

The internet and intranet facilitate _____. A)parallel delivery. B)cheap delivery. C)expensive delivery. D)forward-time delivery. E)on-time delivery.

_____ influences decisions regarding what activities and technologies a company should concentrate its investment and managerial resources in (in relation to its competitors in the industry). A)Relative advantage B)Absolute cost advantage C)Comparative advantage D)Competitive advantage E)Sourcing advantage

_____ affects the company's decision about where to source and market, based on lower cost of labor and other resources in one country relative to another. A)Relative advantage B)Absolute cost advantage C)Comparative advantage D)Competitive advantage E)Sourcing advantage

Sourcing strategy includes two basic choices.One of these is insourcing and the other is _____. A)importing B)outsourcing C)in-sourcing D)matrix manipulation E)horizontal integration

As a type of in sourcing, _____ is when a company procures major components in-house by producing them domestically. A)domestic in-house sourcing B)offshore subsidiary sourcing C)domestic purchasing arrangement D)offshore outsourcing (offshore sourcing) E)export management company

As a type of intra-firm sourcing, _____ is when a company procures major components from its foreign subsidiary. A)domestic in-house sourcing B)offshore insourcing C)domestic purchasing arrangement D)offshore outsourcing (offshore sourcing) E)export management company

As a type of outsourcing, _____ is when a company buys major components from independent suppliers overseas. A)domestic in-house sourcing B)offshore subsidiary sourcing C)a domestic purchasing arrangement D)offshore outsourcing (offshore sourcing) E)export management company

Covisint is probably the largest global online _____ procurement system dedicated to the auto industry. A)C2B B)B2B C)B2G D)C2C E)B2C

Companies that outsource to the extent that they adopt a "designer role" in global competition (i.e., offer innovations in product design without investing in manufacturing process technology) have been described by some as being: A)vertical corporations. B)horizontal corporations. C)hollow corporations. D)supply and demand corporations. E)monopoly manufacturers.

Typical B2B procurement systems rely on _____ that emphasize the lowest bids on a global basis. A)promotions B)selling C)manufacturing D)auctions E)production

A _____ is an area that is located within a nation, but is considered outside of the customs territory of the nation. A)border zone B)red zone district C)warehouse district D)dock facility E)free trade zone

In the United States, a free trade zone is officially called a _____. A)Maquiladora operation B)border zone C)red zone district D)Foreign Trade Zone E)Channel Zone

All of the following are benefits of using a free trade zone except: A)duty deferral and elimination. B)lower tariff rates. C)no government interference in intelligence gathering activities. D)exchange rate hedging. E)"Made in U.S.A." designation.

Duty deferral and elimination, lower tariff rates, exchange rate hedging, and a "Made in U.S.A." designation are all benefits of using a _____. A)Maquiladora operation B)border zone C)red zone district D)Foreign Trade Zone E)Channel Zone

At the macro-level, benefits of using a free trade zone include all of the following except: A)increased investment and employment. B)more revenue through increased local taxes. C)obtaining a beachhead in a foreign market without being in the mainstream distribution process. D)the ability to reassemble large shipments into different groupings. E)no duties on labor.

In essence, companies have two options when it comes to configuring their international distribution systems.A firm may decide to sell directly to its customers in a foreign market by using its own local salesforce or through the internet or: A)a firm may decide to create an intermediary at the local level B)a firm may decide to use the resources of independent intermediaries, most often at the local level. C)a firm can request the distribution assistance of a local government D)a firm can decide to distribute only in its region

Which of the following should a company not do with a foreign intermediaries? A)treat companies as short-term partners B)withhold information from the distribution partner C)allow the distribution partner to make marketing strategy decisions E)all of the above

_____ is the fastest growing internet market in Asia. A)China B)India C)Indonesia D)Hong Kong E)South Korea

If a retail firm sells a product under its own store name it is called a: A)unique brand. B)vertical brand. C)horizontal brand. D)store brand or private label. E)hybrid label.

When Heinz sells its soup products to grocery store chains and allows them to put their own store names on the product, the product is being sold as a: A)domestic brand. B)national brand. C)manufacturers brand. D)store brand or private label. E)service label.

In which of the following countries are store brands marginal players because of loyalty to national or manufacturer brands? A)United States. B)United Kingdom. C)Japan. D)France. E)Canada.

As a branding strategy, _____ is especially attractive to MNCs that face well-entrenched incumbent brands in the markets they plan to enter.(This overcomes the problem of shelf-space denial.) A)domestic branding B)national branding C)manufacturers branding D)store branding or private labeling E)service labeling

On-time retail information management carries two distinct advantages which are: A)reduced inventory and accounting information at the retail level. B)reduced inventory and market information at the retail level. C)reduced inventory and manufacturing information at the retail level. D)reduced inventory and production information at the retail level. E)reduced inventory and outsourcing information at the retail level.

Industrialized countries tend to have a lower distribution outlet density than the _____. A)regional markets B)global markets C)world markets D)submerging markets E)emerging markets

Until recently, the Large Scale Retail Store Law in _____ helped to protect small retail stores. A)Singapore B)Pakistan C)Indonesia D)Japan E)South Korea

In _____, store hours are limited and stores do not open on Sundays. A)Germany B)USA C)Mexico D)Brazil E)UK

Various governments have established _____. A)export processing circles. B)export processing groups. C)export processing clans. D)export processing networks. E)export processing zones.

_____ usually provide tax- and duty-free treatment of production facilities whose output is meant to be exported. A)Gray products processing zones B)High-tech processing zones C)Maquiladora processing zones D)Export processing zones E)Import processing zones

Coca-Cola Enterprises is a whole owned subsidiary of the Coca-Cola Company.

In geographically concentrated countries, such as Japan and Britain, firms tend to incur relatively more warehousing, customer service/order entry, and general administrative costs than in geographically larger countries.

Global logistics encompasses materials management only.

Materials management does not include the inflow of raw material, parts, and supplies through the firm.

Materials management refers to the movement of the firm's finished products to its customers, consisting of transportation, warehousing, inventory, customer service/order entry, and administration.

Physical distribution refers to the inflow of raw materials, parts, and supplies in and through the firm.

In Asian countries, personal "connections" of who knows whom frequently seem to outweigh the Western economic principle of profit maximization or cost minimization in conducting business.

In the US, the Jones Act requires passengers and merchandise being transported by ship within the United States to travel on U.S.-built, U.S.-owned and U.S.-staffed vessels.

In the US, the Merchant Marine Act of 1920 significantly reduces the costs of logistics in and around the United States.

The bulk of international trade is handled by airlines.

Ocean shipping is used extensively for the transport of heavy perishable cargoes.

Honda, a Japanese automobile manufacturer, owns its own fleet of cargo ships and uses them to ship soybeans.

Honda, a Japanese automobile manufacturer, owns a number of highly successful specialty tofu restaurants in Tokyo frequented by young trendsetters in Japan.

Changes in aircraft design have now enabled air transshipment of relatively bulky products.

Today's modern jumbo cargo jets, such as the C-130 and the AN-32, can carry more than 200 tons of cargo.

Air freight represents more than 40 percent of the value of goods shipped in international commerce.

In intermodal transportation, only one type of transportation is employed.

Multinational corporations can use just-in-time delivery as a strategic tool in dealing with currency fluctuations and as a hedge against inflation.

Inventory is immune to currency fluctuation.

Rationalization means reducing resources to achieve more efficient and cost-effective operations.

What and how much a firm transfers within its global manufacturing system is a function of the tax systems in various countries to and from which the transfers are being made.

The alternative rock band Pearl Jam uses FedEx to move their gear around for concerts.

Logistics can go easily as global as e-commerce in reality.

Most e-businesses sip overseas.

Despite the immense competitive advantage that logistics can generate for the organization, manufacturers often find that logistics operations are usually faster and less expensive if they are outsourced.

Only about 50 percent of Fortune 500 companies operating in the United States now seek assistance from one or more 3PLs.

In 2018, two thirds of KFC's 900 U.K.locations were affected by a breakdown in the supply chain leading to shortages of chicken, gravy and other items.

In the US, the shipping company UPS repairs computers for Toshiba.

There are risks associated with 3PL sourcing but they are minor.

Competitive advantage refer to the mix of skills and resources that a firm possesses that enable it to produce one set of goods and/or services in a much more effective manner than another firm.

Blockchain technology is not finding much use in logistics.

Sourcing strategy includes a number of basic choices that companies make in deciding how to serve foreign markets.

In developing viable sourcing strategies on a global scale, companies must consider the costs of manufacturing and various resources as well as exchange rate fluctuations.All other considerations are minor.

Where to source major components seems much less important than how to source them.

Trade that takes place between a parent company and its subsidiaries abroad is called insourcing.

If it takes place at a company's foreign subsidiary, it is called domestic insourcing.

Typical B2B procurement systems rely on auctions on a global basis.

Outsourcing typically lowers a firm's variable costs but raises its breakeven point.

A lower break-even point makes a firm more susceptible to fluctuating demand conditions.

The Sony brand has been highly successful with outsourcing.

In 2018, China was the leading exporter of commercial services.

Many U.S.companies have started outsourcing an increasing portion of software development to companies in China.

Core services are the necessary outputs of an organization that consumers are looking for.

Supplementary services those services that are unrelated to the execution of the core service.

Over time, core services may become a commodity.

We can expect that core services are usually performed by the service firm itself, regardless of the characteristics of the core service.

In the United States, a free trade zone is officially called a Free Foreign Zone

Goods shipped into a free trade zone in the United States from abroad are legally considered not having landed in the customs territory of the United States and thus are not subject to U.S.import tariffs.

If materials and components are shipped to a FTZ for further processing and finished products are sold in the United States, a U.S.import tariff will be assessed on the value of the materials and components, rather than on the value of the finished products.

A free trade zone can be used to hedge against currency fluctuations.

Import quotas apply to goods stored in a free trade zone.

China does not use free trade zones.

Coverage refers to the market segments or geographic area a firm's products are represented in.

Distribution channels that use intermediaries, agents, or merchants positioned between the manufacturer and customers in a distribution channel, can often have several levels and employ several intermediaries, each with its own specific purpose within the distribution channel.

An agent intermediary takes title to goods.

A merchant intermediary does not take title to goods.

In developed parts of the world, retailing employs between 7 percent and 12 percent of the workforce and wields enormous power over manufacturers and consumers.

Wal-Mart is the largest retailer in the world.

In China, basket shopping is still considered the norm for most consumers.

In Japan, private-label brands are very popular.

When Peter Drucker described logistics as "the darkest continent of business" he probably meant it is was _____.

_____ transportation refers to the seamless transfer of goods from one mode of transport to another and vice versa without the hassle of unpacking and repackaging.

_____ is defined as the design and management of a system that directs and controls the flows of materials into, through and out of the firm across national boundaries to achieve its corporate objectives at a minimum total cost.

_____ refers to the inflow of raw materials, parts, and supplies in and through the firm.

_____ refers to the movement of the firm's finished products to its customers, consisting of transportation, warehousing, inventory, customer service/order entry, and administration.

_____ refers to coordinating production and distribution across geographic boundaries.

In global logistics and distribution, 3PL stands for _____.

A _____ is an area that is located within a nation, but is considered outside of the customs territory of the nation.

_____ refers to the market segments or geographic area a firm's products are represented in.

_____ is any retailing activity that transcends national borders.

In Japan, until early 1990s, the _____ gave small retailers and wholesalers disproportionate influence over the Japanese market by requiring firms planning to open a large store to submit their business plan to the local business regulation council, and other organizations.

Explain what the terms global logistics, materials management, and physical distribution mean.Describe the various operations and procedures encompassed by these terms.

The global logistics manager must understand the specific properties of the different modes of transportation in order to use them optimally.What are the most important factors in determining an optimal mode of transportation? List and briefly describe each of the factors.

Explain the role that so called "third-party logistics" (3PL) companies play in contemporary international trade.Cite the advantages of using third-party companies in the trade process.

Explain the role of the free trade zone in modern trade.Explain the free trade zone's relationship and benefit to global logistics.

In which parts of the world are private labels popular? Why? What factors might explain this?