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Sales And Distribution Management(Mktg 543) Question Paper
Sales And Distribution Management(Mktg 543)
Course:Business Administration
Institution: Kenya Methodist University question papers
Exam Year:2011
TIME : 3 HOURS
INSTRUCTIONS Question ONE is Compulsory. Answer a total of TWO Questions from SECTION A and TWO from SECTION B
SECTION A: DISTRIBUTION MANAGEMENT
WAL-MART
Wal-Mart Stores Inc., is the largest retailer in the world, with sales of $259 billion in 2003, 1.5million employees and 4,300 facilities. Each week over 100 million customers visit a Wal-Mart store. Sam Walton founded the company in 1962 with a simple goal: Offer low prices to everyone. His notion of hard work and thrift continue to permeate Wal-Mart today, although he died in 1992. Employees see their job as a mission to “to lower the world’s cost of living.” Wal-Mart’s philosophy is to enable people of average means to buy more of the same products that were previously available only to rich folks. The company works hard at being efficient and using its buying clout to extract lower prices from suppliers, and then passes those savings on to consumers.
Wal-Mart succeeds in the competitive American retail market for several reasons. First, its low prices, vast selection, and superior service keep the customers coming in the door. But one of the Wal-Mart’s biggest strengths is not even inside the store. Its unrivaled logistics ensure that it can keep prices low while keeping the right goods on the shelves. As the biggest retailer in the United States, Wal-Mart’s logistics demands are considerable. The company must coordinate with more than 85,000 suppliers, manage billions in inventory in its warehouses, and bring that inventory to its retail shelves.
To streamline these tasks, Wal-Mart set up a “hub-and-spoke” network of 103 massive distribution centers. Strategically spaced across the country, no store location is more than a day’s drive away from a distribution centre. Wal-Mart is known as “the king of store logistics” for its ability to effectively manage such a vast network.
Sam Walton was something of a visionary when it came to logistics. He had the foresight to realize as early as 1960’s, that his goals for the company growth required advanced information systems to manage high volumes of merchandise. The key to low-cost retail is knowing what goods would sell And in what quantities – ensuring that store shelves never have too much or too little of any item. In 1966 Walton hired the top graduate of an IBM school and assigned him the task of computerizing Wal-Mart’s operations. As a result of this forward looking move, Wal-Mart grew to be the icon of just-in-time inventory control and sophisticated logistics. By 1998, Wal-Mart’s computer database was second only to the Pentagon’s in terms of capacity.
Wal-Mart’s logistics success is astounding considering its size: Over 100 million items per day must get to the right store at the right time. To accomplish this goal, Wal-Mart developed several IT systems that work together. It all begins at the cash register or point-of-sale (POS) terminal. Every time an item is scanned, the information is relayed to headquarters via satellite data links. Using up-to-the-minute sales information, Wal-Mart’s Inventory Management System calculates the rate of sales, factors in seasonal and promotional elements, and automatically places replenishment orders to distribution centers and vendor partners.
Wal-Mart uses its information systems for more than just logistics. Suppliers can use its voluminous POS databases to analyze customers’ regional buying habits. For example, Proctor & Gamble learned that liquid Tide sells better in the North and Northeast while Tide powder sells better in the South and Southeast. P&G uses information such as this to tailor its product availability to specific local regions. This means that it delivers different Tide products to different Wal-Mart locations based on the local customer preferences. Wal-Marts may look the same on the outside, but the company uses its information systems and logistics to customize the offerings inside each store to suit regional demand.
Wal-Mart continues to grow. Despite already having 3,200 stores in the United States, Wal-Mart plans to add another 220-230 Supercenters, 50-55 discount stores, 35-40 Sam’s Clubs, and 25-30 Neighborhood Markets in the United States alone, and an additional 130 units internationally. If Wal-Mart maintains the average growth rate of the past 10 years, it could become the world’s first trillion-dollar company.
Question 1
a) What have been the key success factors for Wal-Mart? (6marks)
b) Where is Wal-Mart vulnerable and what should it watch out for? (9marks)
c) What recommendations would you make to senior marketing executives on the way forward? (10marks)
Question 2
a) Discuss the nature and importance of marketing logistics and integrated supply chain management. (10marks)
b) Discuss the impact of technological environment on a firm’s logistical activities using an example of a company of your choice. (15marks)
Question 3
a) Inventory is an asset and a liability. Discuss. (8marks)
b) Explain the term inventory visibility. What are the advantages of inventory visibility? (8marks)
c) Discuss the types of businesses and organizations that you could work for as a logistics manager. (9marks)
SECTION B: SALES MANAGEMENT
Question 4
a) It is recognized that a salesperson should always be hungry for product knowledge. How can this knowledge be obtained. (10marks)
b) Discuss other types of knowledge that a salesperson should have in order to be effective in his or her sales job. (15marks)
Question 5
a) Discuss the cause of sales objections. (9marks)
b) Two sales persons can deliver the same message, yet one communicator can be more persuasive than the other. Discuss the characteristics that make communicator A more persuasive than communicator B. (16marks)
Question 6
a) Salespeople often find themselves in bargaining situations in the course of their work. Discuss the skills required for effective negotiations. (10marks)
b) Discuss the various ways that an organization can motivate its sales force so that they feel encouraged to work well towards the achievement of the organization’s goals. (15marks)
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