Question

12. Under which circumstances might a business decide to produce its products in various locations rather than use a central distribution center?
if it has a lot of products
if the locations are far from each other
if fuel costs are low
if the competitors are using central distribution

Answer 1

if the locations are far from each other

Explanation:

A company may decide to take up such measures if

1. the sites where the products are sold are very far from each other and the expenditure of distribution hampers profit.
2. if it is viable to put up small manufacturing and distribution centers
3. if the different products of a firm require different sort of manufacturing which is viable in different places and not in a centralized unit.

All of these stem from the logistic concern of the locations of operations being far enough from each other for these measures to come into play.