Question

Which distribution channel is a small manufacturer of specialty wood gift products sold to gift shops most likely to use? Assume that the manufacturer is not able to afford its own sales force.
a) Producer to contractor
b) Producer to industrial distributor to contractor
c) Producer to agent to retailer
d) Producer to industrial distributor to agent to contractor.
e) Producer to contractor to agent.

Answer 1

Answer:

C, producer to agent to retailer

Explanation:

For a small manufacturer that cannot afford its own sales force, the best channel or chain of distribution is for the manufacturer to send his products to an agent then the agent sells the retailers.

The agent in this case has the sales force to distribute products which the manufacturer can't afford. This means that the manufacturer is most likely going to cut a deal with the agent as to how much will be remmited or how much the products would be sold to him and then he can pass it on to retailers for an added price.

All of these helps both the manufacturer, agent and retailer make profitsas well as ensure smooth and continuos distribution of products.

Cheers.