Question

Explain any three market-related considerations to be used by an entrepreneur while selecting the channel for distribution.

Answer 1

• Number of buyers: If the number of buyers is large, then it is better to take the services of middlemen for the distribution of the goods. On the contrary, the distribution should be done by the manufacturer directly if the number of buyers is less.
• Buying habits: A manufacturer should take the services of middlemen if his/her financial position does not permit him/her to sell goods on credit to those consumers who are in the habit of purchasing goods on credit.
• Buying quantity: It is useful for the manufacturer to rely on the services of middlemen if the goods are bought in smaller quantity.