Sharyl Kabbes manufactures dairy products on her farm outside Walkerton,Ontario.Her products carry the brand name Mrs.K's Premium.The company sells milk,cheese,and sausage products.The products are sold individually or in sets that include a variety of cheeses and sausage products for a special price.Currently the products are sold only in Ontario.Mrs.K's products were introduced with a high price relative to competition.Kabbes says that her products are premium and therefore justify the high initial price.To get retailers to carry Mrs.K's products,the company offers discounts to buyers who will transport the products from the Kabbes Farm to their warehouses.Kabbes also offers retailers money to run ads for Mrs.K's products.
Because Mrs.K's products are perishable,transportation is very important,and some of her customers could not take advantage of the discount offered for picking up the product from the farm.As such,Kabbes has decided to divide the province into several segments and base her freight charges on the location of the buyer within these segments.
-Refer to Mrs.K's Premium Cheese.What is the type of discount offered by Mrs.K's to buyers who are willing to assume the transportation of products from the farm to their warehouses?

Question

Quizplus · Accepted Answer

The discount offered to buyers who are willing to transport the products themselves is a functional discount, as it is provided for performing a specific function or service, in this case, transportation.

Sharyl Kabbes Manufactures Dairy Products on Her Farm Outside Walkerton,Ontario