Question

The foreign market entry mode in which the manufacturer utilizes a local third party for the export transaction is known as:

a. contract manufacturing.
b. direct exporting.
c. intensive distribution.
d. indirect exporting.

Answer 1

Answer:

The correct answer is letter "D": indirect exporting.

Explanation:

Indirect exporting is the business strategy by which companies handle their products to an intermediary so the intermediary is in charge of exporting the goods to end-consumers or retailers. While this practice allows firms to concentrate on domestic operations only it could represent a disadvantage since their companies' operations remain narrowed which could represent a lost chance to increase profits.