If a firm decides to contract its physical distribution functions to third parties that have no managerial authority within the marketing channel, it is using
A) outsourcing.
B) sole-sourcing.
C) logistics.
D) wholesaling.
E) distribution services.

Question

Quizplus · Accepted Answer

When a firm contracts out its physical distribution functions to third parties that have no managerial authority within the marketing channel, it is known as outsourcing. This allows the firm to focus on its core business activities while leaving the distribution functions to specialized logistics companies. This approach can be cost-effective and efficient for many firms. Sole-sourcing refers to the practice of procuring goods or services from a single supplier, while logistics refers to the management of the flow of goods and services from the point of origin to the point of consumption. Wholesaling refers to the sale of goods or services to retailers, while distribution services may encompass a range of activities related to the transportation, storage, and delivery of products.

If a Firm Decides to Contract Its Physical Distribution Functions