A company is considering using a direct distribution strategy. What is a disadvantage of this distribution strategy?Longer distribution channelRequired to arrange for transportationDecreased product controlIncreased costs of the logistic chain
Question
A company is considering using a direct distribution strategy. What is a disadvantage of this distribution strategy?Longer distribution channelRequired to arrange for transportationDecreased product controlIncreased costs of the logistic chain
Solution
One disadvantage of a direct distribution strategy is the increased costs of the logistic chain. This is because the company will have to handle all aspects of distribution itself, including storage, transportation, and delivery. This can be more expensive than using intermediaries, who can often provide these services more efficiently due to their expertise and scale. Additionally, the company will need to invest in infrastructure and personnel to manage the distribution process, which can also add to costs.
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