Famous Al's purchases different fruits from local farmers and then sells them to local restaurants and retailers.If the fruits rot before Al sells them he takes the loss.As an intermediary,Famous Al's is performing the function of ________________.
A)Financing
B)Market research
C)Buying
D)Risk-taking
E)None of these

Question

Quizplus · Accepted Answer

A big part of how an intermediary can add value is by reducing the risk of others in the channel. Any of the major physical distribution functions that are assumed by a channel member comes with potential risks and liabilities. For example, accumulating bulk in perishable goods comes with a risk of spoilage if customer demand estimates are inaccurately high. Also, when product liability lawsuits are filed, the defendants named are nearly always anyone within the distribution channel that played a part in getting the product to market.

Famous Al's Purchases Different Fruits from Local Farmers and Then