Question

Which of the following is a TRUE statement about distribution centers?
A. They enable retailers to carry less merchandise in individual stores.B. Distribution center space is typically more expensive than retail space.C. They are appropriate for all retailers, from the largest to the smallest.D. They are the quickest way to get all products to retailers.E. They always involve a pull marketing strategy.

Answer 1

Answer:

A. They enable retailers to carry less merchandise in individual stores.

Explanation:

A distribution center offers storing services for producers' goods. Apart from storing, a distribution center provides other value-added services such are packaging and product mixing. A distribution center is more customer-centered. Its customer includes retailers and consumers. The distribution center is a bridge between a producer and the customers.

Fulfilling customers' orders is a primary function of distribution centers. Because of this role, a distribution center experiences more movements of merchandise than a warehouse. Retailers are among the biggest beneficiaries of distribution centers. They don't have to hold huge quantities of stock in their premises as they can always re-stock from a nearby distribution center. It means that retailers do not need to commit a huge amount of money in inventory management.