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CUSTOMER_CODE SMUDE DIVISION_CODE SMUDE EVENT_CODE APR2016 ASSESSMENT_CODE MB0046_APR2016 QUESTION_TYPE DESCRIPTIVE_QUESTION QUESTION_ID 73191 QUESTION_TEXT Briefly discuss the different types of agent wholesalers. SCHEME OF EVALUATION Agent wholesalers are primarily involved in the buying and selling of goods and services. They typically negotiate sales as representatives of other firms and do not take title to merchandise. The different types of agents are: (Each point carries 2 marks) 1. Manufacturers’ agents: They are independent firms which typically handle non-competing lines of a variety of manufacturers and are often used in place of a manufacturers own sale force. New companies use manufacturer’s agents when they have neither the expertise nor the resources to develop their own sales force. Established firms rely upon manufacturing and prefer to subcontract their distribution activities or when they wish to enter in new markets. 2. Brokers: They are commonly used in the real estate industry where they negotiate the buying and selling of property as well as negotiate its rental and leasing. They are the middlemen whose primary activity is to establish contact between the buyer and the seller. They negotiate and facilitate sales and are compensated by a fee or commission. They do not undertake title of merchandise. 3. Commission merchants: They are sometimes called factors. They receive products on consignment basis and sell them on a commission basis. They typically operate on an autonomous basis. They are most often used in distribution channels for farm produce, lumber products etc. where the manufacturers identity is relatively unimportant to the buyer. 4. Selling agents: They differ from manufacturer’s agents and brokers in that they normally carry a supplier’s entire product line. Unlike manufacturer’s agents and brokers, they usually set prices and terms of sale and also undertake promotional activities. Thus selling agents in effect act as the manufacturers sale force. As with other agent wholesalers, selling agents do not take title or possession of the goods they handle. 5. Auction companies: They invite buyers and sellers to a single physical location, either at the seller’s location or at the auction company’s site. In addition to bringing buyers and sellers together, auction firms promote the goods they handle and actively negotiate the sale of those goods. These wholesalers participate to a less degree in the other marketing flows, except for ownership. Their participation in a channel is typically limited to facilitating a transfer of ownership. These firms also play a key role in the marketing of some commodities such as tobacco. QUESTION_TYPE DESCRIPTIVE_QUESTION QUESTION_ID 73193 QUESTION_TEXT Explain the various characteristics that affect the consumer buying behavior? SCHEME OF EVALUATION Influence of cultural factors Culture Subculture Social class Influence of social factors Reference group Family Role and status Influence of personal factors Psychological factors Motivation Perception Selective attention Selective distortion Selective retention Learning Attitude QUESTION_TYPE DESCRIPTIVE_QUESTION QUESTION_ID 73194 QUESTION_TEXT Explain the stages of product lifecycle Introduction stage Growth stage SCHEME OF EVALUATION Maturity stage Decline stage 2.5 Mark each with explanation QUESTION_TYPE DESCRIPTIVE_QUESTION QUESTION_ID 126174 QUESTION_TEXT What are the benefits and components of MIS? The benefits of MIS are as follows: MIS is concerned with planning and control. It allows marketing managers to carry out the analysis, planning, implementation, and control responsibilities more effectively. MIS includes all the ingredients that are employed in providing information support to managers in making planning and control decisions. The output of MIS is information that sub serves managerial functions. MIS deals with information that is systematically and routinely collected in accordance with a well-defined set of rules. This implies that a MIS is a part of the formal information network in an organisation. It provides marketing intelligence to the firm and helps in early spotting of changing trends. SCHEME OF EVALUATION MIS assesses the information needs of different managers and develops the required information on time from the supplied data regarding competition, prices, advertising expenditures, sales, distribution and market intelligence, etc. It helps the firm to adapt its products and services to the needs and tastes of the customers. MIS provides inputs from marketing environmental factors like target markets, marketing channels, competitors, consumers, and other forces for creating, changing, and modifying marketing decisions in the formulation of relevant and competitive marketing strategies. It ensures effective tapping of marketing opportunities and enables the company to develop effective safeguard against emerging marketing threats. Components of MIS The overall objective of any MIS is to provide inputs from marketing environmental factors like target markets, marketing channels, competitors, consumers, and other forces for creating, changing, and modifying marketing decisions in the formulation of relevant and competitive marketing strategies. Internal record systems – Internal record systems are available within the company across various departments and provide relevant, routine information for making marketing decisions. The most evident internal record system is the purchase and payment cycle systems. It records the timing and size of orders placed by consumers, the payment cycles followed by consumers, and the time taken to fulfil the orders in the shortest possible time. Marketing intelligence system – A marketing intelligence system is the system of collecting and collating data. This system tries to capture relevant data from the external environment. It collects and manages data from the external environment about the competitors’ moves, government regulations, and other relevant information having a direct impact on the marketing environment of the firm. Analytical marketing systems – Analytical marketing systems are also known as Marketing Decision Support Systems (MDSS). A MDSS is a coordinated collection of data, systems, tools, and techniques with supporting software and hardware. Using this collection, an organisation gathers and interprets relevant information from business and environment and turns it into a basis for marketing action. It involves problem-solving technology consisting of people, knowledge, software, and hardware integrated through the information technology platform into the sales management process of the organisation. Marketing research systems – Marketing research systems are based on systems and processes that help marketing managers to design, collect, analyse, and report data and findings relevant to a specific marketing situation facing the company. It also involves analysis of information, which includes a coordinated collection of data, systems, tools, and techniques with supporting software, and hardware by which an organisation gathers and interprets the relevant data and turns it into a basis for marketing action and tactics. QUESTION_TYPE DESCRIPTIVE_QUESTION QUESTION_ID 126175 QUESTION_TEXT Explain the steps in business buying process. 1. Step 1: Recognising an organisational need SCHEME OF EVALUATION Organisational purchasing starts with the identification of demand for products and services. While there are different kinds of needs, most needs arise out of situations related to the operation of the business. Need recognition is not always as complicated or involved as it is in new task and modified re-buy decisions. It becomes a routine, particularly in a straight re-buy situation. A large construction company may negotiate a contract with a steel beam supplier to replenish inventory on demand. Purchase orders are automatically written and sent to the supplier when the inventory reaches a pre-specified mark. Such routine buying situations offer the best opportunities to use computer based database management systems. 2. Step 2: Determining product specifications Subsequent to identification of the responsibility centre, the purchase manager also specifies exact product and service descriptions for procurement. It is also necessary to estimate the exact quantity required and the period in which these quantities need to be delivered. An estimate of other associate services required for the purchase of specified goods and services is also necessary. 3. Step 3: Identifying suppliers If there are many suppliers on the list, a screening procedure that bases its decisions on certain predefined criteria is needed. The information gathered enables the organisational buyer to quickly look for suppliers who can meet minimum requirements. These requirements might be delivery time, capacity to meet the buyer’s quantity needs, and breadth of the product line. Failure to meet a minimum requirement usually means that a supplier will not be included in the list of acceptable suppliers, no matter how well that supplier stacks up on other criteria. Because of a good past service to the company, a purchasing agent may, for example, put a supplier on the list though he/she does not meet the minimum requirements. At this stage, the buying centres search for different suppliers and try to find out their qualification or eligibility by collecting information on their performance and capability from various sources. It then notifies or requests for proposals from possible suppliers and sends these proposals for evaluation to the standing committee on purchase. 4. Step 4: Information search and supplier evaluation A buying centre may have to evaluate several product types for a particular use before suppliers can be selected. If products are complicated, technically trained people sort through the alternatives to recommend those that meet previously developed product specifications. For instance, many companies deal with the rapidly changing technology of computer products (both hardware and software) by creating task forces that keep themselves abreast of current product developments. A task force recommends product types that are suitable for particular applications. 5. Step 5: Negotiation of purchase orders An organisational buyer may negotiate a contractual agreement with a supplier. An agreement of this kind can cover a single purchase of a product or repurchase of the product over a period of time. Contracts are commonly used in straight re-buy situations. The buying centre of a large supermarket chain enters into contracts for purchases of frequently sold products like soap, toothpaste, and peanut butter for a year or more. Buying centres negotiate terms of payment, credit, and delivery during this stage to arrive at a specified order routine, which the supplier is required to honour under the negotiated agreement. Normally a term of contract is signed between both the parties. 6. Step 6: Evaluation of supplier performance Organisational buyers usually want to know how well suppliers comply with the purchase agreement. Thus, an important part of organisational purchasing is evaluation of suppliers after purchase. This task is typically assigned to the purchasing department. The criteria used for supplier selection become the performance standards for this evaluation. Information is collected on the performance of the product or service in use. A questionnaire may be sent to users of the product to obtain their input. Other technical measures of performance may also be devised. A manufacturer who purchases aerosol packaging, for instance, may select a sample of the packaging and test it for pressure and evenness of application. The buying centre develops a provision for feedback and evaluation on a continuous basis. It also develops systems and procedures to have a regular communication with the suppliers QUESTION_TYPE DESCRIPTIVE_QUESTION QUESTION_ID 126182 QUESTION_TEXT Explain the functions performed by marketing channels. SCHEME OF EVALUATION 1. 2. Buying (1 Mark) Carrying inventory (1 Mark) 3. 4. 5. 6. 7. 8. 9. 10. Selling (1 Mark) Transportations (1 Mark) Financing (1 Mark) Financing (1 Mark) Promoting (1 Mark) Negotiations (1 Mark) Marketing research (1 Mark) Servicing (1 Mark)