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question 186

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Use this information for question that refer to the World Tennis Ball (WTB) Company case. World Tennis Ball Co.(WTB) makes tennis balls and sells them only in the U.S.Raul Fernandez,the firm's marketing manager,is comparing his firm's distribution with two major competitors.
1) WTB sells its products through four regional distributors who then sell to 22 sporting goods wholesalers.The wholesalers sell to a total of 7,000 retail outlets.From its website,WTB also sells directly to any customer who will purchase a minimum quantity of 24 tennis balls.WTB cooperates with members of its channel,but maintains some control through its economic power and leadership.It helps to direct the activities of the whole channel and tries to avoid or resolve channel conflicts.
2) American Tennis Ball (ATB) is a competitor that sells through two distributors-each with half the country.The distributors then sell through 6 sporting goods wholesalers,and they,in turn,sell to 1,000 retail outlets (split between two national sporting goods chains and two general merchandise stores) .ATB and its channel make little effort to work together.However,because of a relatively low level of competition between the distributors,the wholesalers,or the retail stores,each member of the channel gives the product special attention.
3) National Tennis Ball (NTB) sells its products through only three tennis specialty wholesalers that sell only to tennis clubs.NTB actually owns the wholesale firms that handle its products.NTB's balls are only available at certain tennis clubs and NTB limits coverage to only one club in a particular geographic area.
Which of these companies appears to operate as a channel captain?

Recognize the role of economic profits and losses in a perfect competitive market structure.
Comprehend the significance of standardized products in perfect competition.
Analyze the demand curve faced by perfectly competitive firms.
Describe the impact of market entry and exit on market equilibrium in perfect competition.

Definitions:

Integration

The process of combining or coordinating separate elements into a unified whole, often used in technical and organizational contexts.

Elaboration

The process of adding more detail or information to something, often to clarify or explain further.

Methods

Different ways or strategies of accomplishing a task or solving a problem.

Mechanistic

An organizational structure that is hierarchical and bureaucratic, with clear lines of authority, formal rules, and procedures.

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