CPIM Distribution Planning 3

Question 1

In a hub-and-spoke distribution network, the primary function of the hub is to:

Accepted Answer

Consolidate and sort shipments for redistribution to spoke locations

Answer

Hubs act as consolidation and sorting points that receive shipments from spokes or suppliers and redistribute them to their destinations.

Question 2

The 'bullwhip effect' in distribution occurs when:

Accepted Answer

Demand signals are amplified as they move upstream in the supply chain

Answer

The bullwhip effect describes how small demand variability at the retail level becomes amplified into large order swings at upstream tiers.

Question 3

Which type of distribution channel involves goods flowing from manufacturer to wholesaler to retailer to consumer?

Accepted Answer

Two-level channel

Answer

A two-level channel has two intermediaries (wholesaler and retailer) between the manufacturer and end consumer.

Question 4

Pool distribution is most beneficial when:

Accepted Answer

Multiple customers in the same region receive less-than-truckload shipments

Answer

Pool distribution consolidates LTL shipments destined for the same region, reducing per-unit transportation cost through consolidation.

Question 5

Which distribution strategy should a company prioritize when customer service level is the primary competitive advantage?

Accepted Answer

Position inventory geographically to reduce order cycle time

Answer

When service is the key differentiator, positioning inventory near customers reduces lead time and improves fill rates.

(CPIM) Certified in Planning and Inventory Management Practice Test