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Kapa Oil manufacturers have decided to eliminate wholesalers in their chain of distribution. Outline FIVE possible effects that would result if wholesalers were eliminated.

Kapa Oil manufacturers have decided to eliminate wholesalers in their chain of distribution.
Outline FIVE possible effects that would result if wholesalers were eliminated.

Answers

gideon
- Manufacturers would set up distribution centers /depots or warehouses which are additional
costs to manufacturers.
- The cost of distribution may be increased and the subsequent increase passed on to consumers
inform of
higher prices.
- The retailers would have to go to manufacturers, which is an additional cost to retailers.
- The producers would have to break the bulk because retailers may not be able to buy in large
quantities.
- Manufacturers may be required to extend credit facilities to retailers, which require additional
financial capital.
- Due to additional functions to producers, it will reduce their specialization in production.
- Prices may fluctuate due to unsteady flow of goods.
gideon1 answered the question on October 2, 2017 at 17:07

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