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Scenario 15.2 Use the Following to Answer the Questions

question 167

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Scenario 15.2
Use the following to answer the questions.
Star Supplies,Inc.manufactures commercial-grade floor cleaners,such as vacuums and floor polishers.The firm has recently begun manufacturing other janitorial-related product lines,such as paper products and chemical cleaners.Star Supplies distributes its products in two ways.It sells its vacuum,floor polisher,and janitorial supply products to an independent business that takes title to the products and then sells them to various small businesses throughout the region.Also,Star has a list of large businesses that it distributes to directly,on an as-needed basis.These businesses keep very little inventory and purchase janitorial supplies in small quantities.Recently,Star has decided to add new two new service product lines-paper shredding and a uniform rental service.Clint Rodriguez,the marketing manager,is conducting a meeting to discuss the ways in which Star can strategically manage these new businesses.Star has the choice of marketing the paper shredding service to their large business clients,by picking up the paper as they drop off the other janitorial supplies,or they can buy a small paper shredding business and market to both large and small business customers.With regard to the uniform rental service,Star can either pick up and deliver the uniforms to the small businesses themselves,or contract that out to a third party.
-Refer to Scenario 15.2.Currently,Star is using the ____ approach to distributing its janitorial supplies to its large customers.

Definitions:

Total Product

The total output of goods and services produced by a firm using given inputs within a specific time period.

Additional Unit

Refers to one more quantity of a good or service added to previous totals, often in contexts discussing costs or benefits.

Complementary Resources

Productive inputs that are used jointly with other inputs in the production process; resources for which a decrease in the price of one leads to an increase in the demand for the other.

Price Decrease

A reduction in the monetary value that must be paid for a product or service.