Many Firms Prefer to Distribute Directly to the Final Customer

question 307

Multiple Choice

Many firms prefer to distribute directly to the final customer or consumer because they

• A) want to control the whole marketing job.
• B) believe they can serve target customers at a lower cost.
• C) think they can do the work more effectively than intermediaries.
• D) can use the Internet to make direct distribution easier.
• E) all of these are reasons why firms prefer direct distribution.

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Definitions:

Finished Goods

Goods that are completed production and are now available for customer acquisition.

Manufacturing Overhead

All indirect costs related to manufacturing, such as maintenance, supervision, and utilities, not directly tied to any specific product unit.

Indirect Materials

Materials used in the production process but not directly traceable to a specific product, such as lubricants and adhesives used in machinery.

Direct Materials Cost

The expense associated with the raw materials and components used in the manufacturing of a product.