Quiz SITXMGT002 Establish and conduct business relationships

1. Tick

Having a relationship focus rather than a transaction focus can be beneficial to a business. Select
the examples of these benefits:

Better production processes

 Customer retention

Positive word-of-mouth advertising

Improved product catalogues

Reduced staff turnover

 Enhanced marketing materials

2. Multiple True or False

Indicate whether the following statements relating to customer relationships are true or false:

Customers like to form a relationship with their service providers as it makes them feel better about
their choices. True

Tapping into this aspect of human nature can help businesses gain repeat customers. True

Walk-in customers are worth more to a business than repeat customers, because walk-in customers
are not budgeted for and are therefore pure profit. False

Repeat relationships are important, regardless of the frequency of the repeat custom. True

3. Tick

Which of the following are examples of internal customers? Select the correct answers

Suppliers
 Employees
Competitors
 Accountants
 Managers
 Supervisors
 4. Multiple True or False

Indicate whether the following statements in regard to relationships are true or false:

1. Service staff should sample or experience the products to enhance their product
knowledge and help motivate them: True
2. Using complementary relationships can bring benefits to both parties : True
3. Business financiers and banks are not part of the relationships that must be valued by a
business : False
4. Local community events do not achieve revenue and should not form part of the
business relationship planning : False
5. Complimentary service providers, private contractors, local councils, tourism bodies and
Emergency Services are examples of groups you should form business relationships with
True

5. Match Corresponding & Tick

Match the terms that should be negotiated on with a supplier to the relevant description:

Price – Operational departments and businesses need to stay within their allocated budgets, so it is
important negotiate to get the lowest available

Quality – TH&E businesses rely on selling this type of products and services to their customers.
Therefore, it is important that a business sources the best available, or has a supplier who is trusted
to act on their behalf

 Credit terms and conditions – This refers to the length of time the supplier will give the
purchaser to pay for the purchased items. They are usually between 14 and 60 days
 Service/delivery schedule – It is important to know when and how deliveries will arrive. This is
especially crucial for remotely located businesses and has impacts on issues such as storage
space requirements
 Discount structure – These are often offered based on the amount or regularity of orders, or as
part of a reward system

6. Tick

TH&E businesses should form and maintain business relationships with the following groups:
Select the correct answers:

1. Product suppliers : correct

2. Taxation department
3. Service providers: correct
4. Private contractors
5. Local politicians
6. Local community: correct
 7. Regional council
8. Emergency services
9. Industry bodies
10. Professional service providers

7. Tick

The following statements relate to online communication. Tick the correct statements.

An online presence plays a key part in the public perception of a business and must be engaging to
create appeal to existing and potential customers : correct

1. Lead generation is a prime advantage of a well-constructed website

2. Because dynamic content can cause the website to stall, all of your marketing messages must
be text-based
3. Websites are a global portal for the business: correct
4. Zuji is an example of a travel business that is fully online
11. By translating your website into the major international languages, you can remove
language and communication barriers between cultures : correct

8. True or False

In order to conduct successful business alliances, relationships must be built on trust, integrity and
equality and conducted in a transparent manner.

True

9. Match Corresponding Tick

Connect the type of agreement with the correct definition:

Service contracts – These are negotiated with private contractors for services required by the
business

Rate agreements – A TH&E business is using a third party to gain custom on their behalf. Businesses
may engage an overseas operator to lower travel costs, to overcome cultural barriers and to take
advantage of the operator’s local knowledge

Preferred product and supplier agreement – This agreement occurs when a hotel allocates a certain
number of rooms to a third party, such as a travel agent or online booking agency

Marketing agreements – Negotiations will involve time and regularity of delivery, quality of goods
delivered, consistency of quality and costs, including bulk discounts
 10. Tick

When conducting negotiations, you must correctly represent your establishment. Which of the
following are examples of things that you should do? Tick the correct examples:

 Smile, hold yourself erect

Slouch or shuffle when you walk into a room

 Offer a firm hand shake and make eye contact

Use casual greetings

 Take notes of participant’s comments

Address each participant individually

 Offer encouragement and praise when the time is right

11. Tick

When conducting negotiations, you must correctly represent your establishment. Which of the
following are examples of things that you should NOT do? Tick the correct examples:

 Slouch or shuffle when you walk into a room

Smile, hold yourself erect

 Use casual greetings

Wear comfortable, casual attire instead of a uniform

 If there are apparent problems with your company’s performance, jokes about the situation will
comfort the other party

Use examples where your product or service has gained success

 Once you have gained ground, dominate the meeting to maintain control

12. Multiple True or False

Indicate whether the following statements relating to negotiations are true or false:

a) In order to effectively conduct negotiations, you need to research and understand your
position in regard to facts, needs, wants and organisational requirements.
True
 You should emphasise the potential benefits to both parties in the context of a potential
business relationship. True

If a negotiation does not go according to plan it is essential to have a fall-back plan. True

After listening to the other party, you must make an immediate decision. Taking time to think is
a sign of weakness. False

Negotiations are a battle of wills and may have to be protracted to make sure that a positive
result is achieved for your business: False

Ethical behaviour must be applied to all negotiations otherwise the achieved results will not
work in the future: True

13. Match & Tick

Match the examples of cultural differences you may encounter during a negotiation to the
relevant example:

One decision maker or a team – Some cultures have one leader to make the final decision, others
rely on a team and things are decided by group consensus.

Emotion and body language – While almost every business agreement will eventually result in a
signed contract, in some cultures lengthy contracts which spell out every possible thing that could go
wrong are a cause for alarm. They prefer general contracts that only discuss the basic principles of
the relationship.

The amount of detail in the contract – In some cultures the reactions during negotiations are very
direct. You can gauge what the person is thinking by the feedback and body language they give you
throughout the meeting. Other cultures are more reserved and will display little or no emotion at
the negotiation table.

The importance of the relationship vs. the contract – For some negotiators, the reason for the
negotiation is to build a personal relationship, for others the reason is to get a signed contract or
purchase order.

14. Tick

Once negotiations have concluded, which of the following should be done? Tick the most correct
answers:

 Confirm agreements and the details of all outcomes in writing

Conduct a credit history check of your client’s business

 Use follow-up procedures as part of the process to nurture the business relationship
 Communicate the results of a negotiation to all those affected e.g. colleagues and staff
 Draft a letter of appreciation to the other party
 Honour agreements and make adjustments in agreements in consultation with the other party

 Evaluate the effectiveness of the negotiation and your part in it

 Seek a performance appraisal from your superior

15. Multiple True or False

Indicate whether the following statements in regard to high level agreements are true or false:

a) Many hotels, resorts and travel agents are subject to management agreements to become
part of a specific brand : False
b) Managed properties or businesses may be subject to annual marketing fees : True
c) Advice and expert services form part of the service provision of most management
agreements: True
d) Franchises are the best way to expand a business rapidly : True
e) Property leases can be risky as they lock the business into payments for the fixed term : false
f) Refurbishment costs are covered by the landlord: False

16. Tick

Before any agreement can be made formal, you must ensure that your organisation approves the
agreement. Tick the commonly required actions:

 Obtaining authority from management before commencing any negotiations

 Reaching an agreed position and then seeking formal approval from a superior

If an agreement will be a major contribution to the company’s benefit, you may obtain approval
at a later date as long as you ensure you obtain the other party’s signatures

 Seeking legal assistance from your business’ legal advisor

If no immediate approval can be obtained from a superior, you must obtain approval from your
colleagues

17. Multiple True or False

Indicate whether the following statements are true or false:

Before any agreement is signed both parties have to gain the relevant authority to proceed: True

Signing agreements ensures the continuance of the contract even if there is a change of personnel or
circumstances: True

Good faith provisions are to be avoided as agreements are often broken: True
Good faith refers to a person who is making an agreement believing that they can in fact provide the
products or services agreed to: True

18. Multiple True or False

What is a contract? What is required for a contract to be valid? Indicate whether the following
statements are true or false:

A contract is an agreement between two or more parties that sets out their rights to negotiate under
law. True

A contract can be a written or oral agreement. True

Contracts are a significantly important tool to ensure arrangements are adhered to and should be in
writing where possible, as this then provides a record. True

For a contract to be valid there must be a financial interest. True

For a contract to be valid something must be exchanged and the people who signed the contract
must be fully aware of what was involved in the contract. True

19. Tick

The following details should be included in an agreement for contractors: Tick the correct
examples:

 Names of contracting parties including trading names and ABN/ACN, as well as their contact
details
 Details of the service/product to be provided
 License and insurance numbers and details

Any conditions associated with providing the service/product

 Superannuation contribution details

 Financial terms, including payment schedule
 Cancellation clause and any penalties for late payments
 Rights and obligations of each party
 Signatures of both parties

20. Multiple True or False

Indicate whether the following statements relating to contracts are true or false.

A contract or an agreement can be terminated by either of the parties that have entered that
contract or agreement. False
 In order to terminate a contract one party must pay the other party a release fee. True

A party can terminate the contract or agreement if it thinks that the other party has breached
the clause/s of the contract or agreement. True

It is important to review, negotiate and update your contracts as the end of the contract term
approaches, to make sure that it is still relevant and useful. True

g) When negotiating changes, you should try to get the best deal possible but not involve your
manager or supervisor in case you end up embarrassed by an unsuccessful negotiation. True

21. Drag the Ticks

Which of the following are examples of ways to maintain regular contact with customers and
suppliers?

 Online communication
 Performance reviews
Site visit familiarisations (Famils)
Product launches
 Personal visits
Personal correspondence
 Promotions
Team meetings

22. Tick

Which of the following are traits which build respect and trust in a business relationship?

 Honesty and sincerity

Treating people with respect
Openness
Being single-minded
Competency
 Looking for win-win solutions
Putting yourself first
 Integrity
 Reliability

23. Multiple True or False

Indicate whether the following statements relating to maintaining contact with regular customers
and suppliers are true or false:

Personally, visiting a client or prospective customer is an effective way of making them feel special
and important: True
In situations where a product or service is sold to another business, it is important for a
representative of the business to periodically visit the client to gain feedback and to confirm that
they are a valued customer: True

A personal visit once a year will never mean the difference between renewing a contract or not, but
it is nice to get out and about: false

An occasional telephone call to check that everything is running smoothly gives a personal touch and
helps to maintain the relationship. True

Birthday and Christmas cards are inappropriate to send to people from another organisation: False

24. Multiple True or False

Indicate whether the following statements relating to business relationships are true or false:

Networking is crucial to creating and maintaining relationships. True

Meeting staff from nearby competitors is not an example of networking. True

Networking possibilities include informal industry social clubs or the occasional coffee with an
ex-colleague. False

Referring business to neighbouring businesses should be avoided as it results in lost revenue.

false

If you refer the customer to another nearby establishment, then when the situation is reversed
you will benefit from the referral. False

Apparently competing TH&E businesses may benefit from forming a marketing alliance and
jointly issuing promotional material. True

25. Drag the Ticks

Effective negotiations require sound principles. Select the correct examples of negotiation principles:

Negotiate on position not substance

 Consider the relationship

 Force issues to achieve a win
 Consider input from colleagues
 Accept the other party’s position
 Use appropriate questions
 26. Multiple True or False

Indicate whether the following statements relating to seeking feedback and input from colleagues
are true or false:

In order to have a full understanding of your company’s position you must research as much
information as possible on your topic. True

If you cannot find the required information you should guess and hope for the best during
negotiations. False

You should speak to the appropriate people in positions of authority and fully understand what
your company wishes to achieve before you commence negotiating. True

Senior colleagues may have advice for you or be able to give you valuable information you can
use during your negotiations. True

You should leave all internal communication until after the negotiations have concluded. False

You may need to ask colleagues for input, feedback or advice during negotiations. True

You should communicate the results of a negotiation to all those affected e.g. colleagues, staff,
financial backers. True