Moustache Manufacturing Has Two Classes of Distributors: JIT Distributors and Non-JIT

question 49

Multiple Choice

Moustache Manufacturing has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders, and the non-JIT distributor tends to place larger, less frequent orders. Both types of distributors purchase the same product. The customer activities and costs for the previous quarter are found below:
$$\begin{array} { l r r } & \text { JIT } & \text { Non-JIT } \\\text { Sales Orders } & 300 & 20 \\\text { Sales Calls } & 25 & 25 \\\text { Service Calls } & 150 & 75 \\\text { Average Order Size } & 100 & 1,000 \\\text { Manufacturing Cost/Unit } & \$ 50 & \$ 50\end{array}$$ $$\begin{array}{l}\text { Customer Costs: }\\\begin{array} { l l } \text { Processing Sales Orders } & \$ 200,000 \\\text { Selling Goods } & \$ 120,000 \\\text { Servicing Goods } & \$ 150,000 \\\text { Total } & \$ 470,000\end{array}\end{array}$$
-Refer to the Figure.What is the total customer cost for the non-JIT distributor?

• A)$12,500
• B)$50,025
• C)$78,791
• D)$122,525

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Definitions:

Private-label Brand

Products manufactured by one company but sold under another company's brand, often positioned as lower-cost alternatives to national brands.

Place

In marketing, refers to the distribution aspect of the marketing mix that determines how products get to the consumer.

Customer Service

The assistance and advice provided by a company to those people who buy or use its products or services.

Category Specialists

are retailers that offer a deep selection within a specific category, often providing a high level of expertise and variety in that category.