Use the Following to Answer the Questions Below

question 81

Multiple Choice

Use the following to answer the questions below.
The Steele Bike Company assembles bicycles for a major retail toy outlet.The main purchase is bicycle frames for making these bicycles.Dan Steele,the owner,wants to locate a low-cost supplier for the frames used in this assembly operation.The supplier will be selected based on total annual cost to supply Steele's needs.Annual requirements are for 100,000 frames,and the company operates 200 days a year.Two suppliers,Acme and State,have quoted the same price for the frames,but quantities,lead times and shipping costs are considerably different.The following data are available for the two suppliers.

-Refer to the instruction above.What are the annual shipping savings available when comparing the two suppliers?

• A)$25,000
• B)$10,000
• C)$7,500
• D)Shipping costs are the same from either supplier

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Definitions:

Segmentation Process

The practice of dividing a market into distinct groups of buyers with different needs, characteristics, or behavior, who might require separate products or marketing strategies.

Segmenting Markets

The practice of dividing a broad target market into subsets of consumers with common needs or characteristics and then designing and implementing strategies to target them.

STP Process

Stands for Segmentation, Targeting, and Positioning, a strategic approach in marketing that divides a broad market into distinct groups, targets specific segments, and positions a brand to meet the needs of selected segments.

Geodemographic Segmentation

A marketing technique that clusters people based on the premise that individuals who live near one another are likely to have similar financial means, tastes, and lifestyles.