Factors affecting business environment like economic conditions or legal constraints affect the choice of distribution channels. State true or false.

True

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False

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Solution

The correct option is A
True

True. Factors of business environment like economic conditions or legal constraints also affects the choice of distribution channels. When a country is going through recession, shorter channels are preferred as these help keep the prices low. Similarly, availability of services like transportation, communication, warehousing, and banking also influences a firm’s channel decisions.

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The two main company characteristics that affect the choice of distribution channels are – financial strength of the company and the degree of control it wants to hold on the channel members. State true or false.

Q. Five Mark Questions:-
Choice of appropriate channel of distribution is a very important marketing decision, which affects the performance of an organisation. Explain any five factors which affect the choice of channels of distribution.

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Q. Three Mark Questions:-
Explain how the 'Product Related Factors' affect the choice of channels of distribution?

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