When planning channels of distribution, a marketing manager should know that
A) vertically integrated systems are seldom used-because of the difficulty of maintaining control.
B) a contractual system offers both flexibility and stability for its members.
C) the disadvantage of a corporate channel system is reduced control over distribution activities.
D) the disadvantage of an administered system is that it is a very formal arrangement.
E) None of these alternatives is correct.

Question

Quizplus · Accepted Answer

A contractual system allows for flexibility in the agreement between the manufacturer and distributors, while still providing stability and control. Vertically integrated systems can be difficult to maintain, and a corporate channel system may result in reduced control for the manufacturer. An administered system is a formal arrangement, but it is not necessarily a disadvantage.

When Planning Channels of Distribution, a Marketing Manager Should Know