Page 173 - BA1 Integrated Workbook STUDENT 2018

Answers to supplementary objective test questions

CHAPTER 11 – CUSTOMERS, SUPPLIERS AND SUPPLY CHAINS

11.1 D

Disintermediation is inappropriate as the company already sells direct to the
end consumer. EDI is also inappropriate as FRT does not currently sell online –
and its customers are individuals, meaning that it is not appropriate to link
FRT’s systems to theirs. A website to increase sales volume seems pointless
given the lack of potential for expansion in the market.

However, a loyalty/reward system would help improve loyalty of customers as
well as enabling FRT to obtain information on the customers and their buying
habits. This could be used to target special offers, which will increase loyalty
further.

11.2 A

Customer account profitability (CAP) focuses on analysis of the costs and
income from each customer or customer group. This would help the company
decide if the government projects were indeed profitable.

CRM looks at managing the ongoing relationship with customers and gathering
information about them. SERVQUAL looks at service quality, while propensity
modelling involves analysing customer behaviour and then making
recommendations to them. None of these other options would therefore be
appropriate.

11.3 B

The tanneries form a key part of JEN’s upstream supply chain – not its
downstream supply chain. The other statements are correct.

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