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BUS 005 Homework #
BUS 005 – Intro to Business
Homework Assignment
October 27, 2008
Due: October 31, 2008
50 Points
USE ADDITIONAL PAPER IF NECESSARY…
Name_______________________________
A. RETAIL DISTRIBUTION STRATEGY (10 POINTS)
The text discusses three categories of retail distribution—intensive distribution, selective distribution, and exclusive distribution. For each of the categories, summarize the distribution strategy and give three examples of each that are NOT included in the text discussion.
INTENSIVE DISTRIBUTION
Summarize the strategy:
Example 1: _____________________________________
Example 2: _____________________________________
Example 3: _____________________________________
SELECTIVE DISTRIBUTION
Summarize the strategy:
Example 1: _____________________________________
Example 2: _____________________________________
Example 3: _____________________________________
EXCLUSIVE DISTRIBUTION
Summarize the strategy:
Example 1: _____________________________________
Example 2: _____________________________________
Example 3: _____________________________________
BUS 005 Homework #
B. UNITED STATIONERS: OFFICE-SUPPLY INTERMEDIARY (
POINTS)
The Internet has created rapid change in the sale and distribution of most goods. Perhaps nowhere is such change more apparent than in the office supply market. By the early 1990s, half of the smaller stationers in the United States had gone out of business—about 6,000 stores. Staples, Office Depot, and other large retailers, many of them with online services, rapidly replaced them. So, what happened to companies like United Stationers that supplied those small stationers with the products they sold?
When that Randall Larrimore became the company’s chief executive in 1994, United Stationers wasn’t doing too well. Larrimore was determined to reverse United Stationers’ fortunes. He modernized United Stationers by using the latest supply-chain concepts.
Come with us to Ketchum, Idaho, to visit a stationer called Business as Usual. It’s a small store; only 1,500 square feet. Despite its size, its prices are competitive with those of not only the office superstores in nearby Twin Falls but also online sellers. The reason Business as Usual remains competitive is that United Stationers can readily provide it with some 35,000 items from more than 500 manufacturers at prices lower than those it could get by ordering directly from the manufactures. United Stationers can purchase the products from the manufacturers more cheaply than small stores because it orders in such large volumes. It can then pass part of the savings on to its customers.
If Business as Usual places an order to United Stationers by 4 p.m., the store gets the supplies by the next day. Even better, Business as Usual can have United Stationers send the supplies directly to its customers. By providing a large inventory and speedy delivery low prices, United Stationers has made it possible for small companies to survive. It was Randall Larrimore who helped make all this possible.
Staples and Office Depot also use the services of United Stationers. These superstores order in such large volumes that they buy most of their products directly from manufacturers. However, there are many products that are not very popular but that superstores must carry in order to become one-stop shopping centers for office supplies. Since ordering these products directly from the manufacturer is not efficient, the superstores turn to United Stationers. Untied Stationers also supplies many of the office products that get sold online by Dell Computer and 125 other companies. . In the United States, there are hundreds of thousands of suppliers like United Stationers, providing similar services to retailers like United Stationers, providing similar services to retailers of products ranging from automobile suppliers to zoo shop souvenirs.
The whole system for distributing goods has changed over the last decade or so. The advent of online retailers has altered the way customers buy and the way manufacturers sell. The Internet has also changed the way goods are distributed.
(www.unitedstationers.com, www.staples.com, and www.officedepot.com)
- What does this case teach you about the need for constant change in marketing?
BUS 005 Homework #
C. PROTECTING COMPETITION AND CONSUMERS (20 points)
The Federal Trade Commission (FTC) deals with issues that touch the economic lives of most Americans. The FTC has a dual purpose. The agency is charged with maintaining a competitive marketplace for both consumers and businesses. When the FTC was created in 1914, its purpose was to prevent unfair methods of competition in commerce as part of the battle to “bust the trusts.” Over the years, Congress passed additional laws giving the agency greater authority to police anticompetitive practices.
Go to the FTC Web site (www.ftc.gov) and use the information there to answer the following questions. (Sometimes the web address for a location changes. You might need to search to find the exact location mentioned.)
- What are the major provisions of the Wheeler-Lea Amendment (1938)? How does this law affect marketing?
- What are the major provisions of the Magnuson-Moss Act? How does this law affect marketing?
- What are the functions of the Bureau of Consumer Protection?
- What are the functions of The Division of Advertising Practices?
- What are the functions of The Division of Marketing Practices? 6. How does the FTC prevent anticompetitive business practices?
