QUESTION 5 Use this information to answer the following question that refer to the El (Electech Inc.) case. Electech, Inc. (El) produces a line of semiconductors for electronics products manufacturers. These items range in price from $S$100 and are used in products the buyer is producing, El also designs and builds computer networking equipment. The prices of these items range from $5,000 to $100.000, These are used to control production equipment. Usually, they are custom made to the specifications of the buyer the firm that will use the product in its own production process. El sells nationally through independent sales reps-paid on commission who work in the large industrial centers across the country. El is more concerned with the quality of these reps than with the number of them. All of them also sell other lines. El also uses five full-time salaried salespeople who work out of its corporate headquarters under a sales manager The home office salespeople are "technical specialists who sell almost all the networking equipment, while the reps mostly sell the semiconductors. Sometimes, however, the reps will send in leads to customers who want networking equipment. El also sells some of its semiconductors through a Los Angeles wholesaler who carries stock for West Coast customers There are many producers and importers of semiconductors in the U.S. but several firms have captured large shares of the networking equipment market El has held its own, and in fact, cover the past five years has increased its market share of these products to over 25 percent because of its better technical designs Industry wide prices of the more or less homogeneous semiconductors have been forced further and further down over the last seven years-as have industry profits. The price of networking equipment is set by adding a standard markup percent to the direct cost of the items for overhead and for profit. Following industry practice, all prices are quoted at the seller's factory El publishes a catalog, which is revised periodically, Also, it exhibits in most equipment trade shows. What kind of products are E's semiconductors FOR MOST CUSTOMERS Supplies Installations O Component parts Accessory equipment Raw materials QUESTION 7 Use this information to answer the following question that refer to the CPI case. Conservo Products, Inc. (CP, with annual sales of $200 million, is a well-known producer of a variety of paper products, almost all of which are made from recycled materials. Picnic plates account for about 70 percent of CPIs sales. The rest of the firm's sales come from custom-designed materials such as box liners and spacers, small boxes, and disposable products-like trays, towels and napkins. CPI's picnic plates are sold through 'sales reps to grocery wholesalers and retail grocery chains. The sales reps are paid a 5 percent commission on all sales in ther assigned territories. They usually handle related-but noncompeting-lines for several other manufacturers. Along with their selling duties, the sales reps help CPI with local advertising and sales promotion efforts. Orders for the custom products are obtained by area managers who are paid a straight salary to call on business and institutional customers. The area managers are trained paper specialists and often help their customers design the products they order The picnic plates are priced to give Pla 90 percent markup on the cost of producing the product with the cost figured by taking the total factory cost for the previous year and dividing that total cost by the number of units produced and sold during that period. The firm's invoices read "F.O.B. Delivered" and "1/10, net 30.- Customers are allowed to deduct 3 percent from the face value of the invoice for buying plates in carload quantities, and another 2 percent for advertising them locally The custom products are sold "FO.B. mill with CPI offering a price for each job. Competition is strong from many other manufacturers who are able to offer very similar products which meet the customers' specifications CPI forecasts that sales will increase to $250 million by 2012. However, much of this growth is tied to picnic plates a market in which the firm has about a 7 percent market share and faces aggressive price competition from many smaller firms with greater brand familiarity. Further, CPI has been late with more than 50 percent of its plate orders due to scheduling conflicts with orders for custom products. Regarding shipping costs in the CP1 case: CPI pays the shipping costs for the plates, while its customers pay the shipping costs for the custom products O CPluses freight-absorption pricing all of CPr's customers take title to the products at the point of loading and pay all shipping costs themselves CPI pays the shipping costs for all its customers keeping title to the products until delivery O CPluses zone pncing QUESTION 4 Which of the following is NOT a trend affecting marketing planning strategy in the area of Business and Organizational Customers? O Shift to NAICS O Closer relationships and single sourcing ISO 9000 Less e-commerce and supply chain management O More use of JIT and EDI