CPIM Practice Exam

Which of the four Ps influences how physical distribution planning and execution addresses product volume, location of demand, and demand fluctuations?

1. Product

2. Price

3. Place

4. Promotion

The correct answer is: Promotion

The correct answer is based on the role of "Place" in the context of physical distribution planning. "Place" refers to the location of products and how they are made available to customers. It encompasses aspects such as the geographic locations where products are stored, the distribution networks in use, and the logistics processes that ensure products are delivered efficiently to meet customer demand. Effective physical distribution planning relies heavily on understanding product volume, locations of demand, and fluctuations in demand. Factors such as where the products are being distributed and how they reach the end customer are major considerations in logistics and supply chain management. By optimizing the distribution channels and ensuring that products are stocked in the right locations, businesses can respond more dynamically to changes in demand, thereby minimizing costs and maximizing customer satisfaction. In contrast, while "Promotion," "Product," and "Price" are important aspects of marketing strategy, they do not directly influence the logistics and distribution aspects related to the physical movement of goods and the planning needed to account for variations in demand and location. Thus, "Place" is the most relevant factor for this question.