Question

When channel members are linked by legal agreements that specify each member's rights and responsibilities, ____ exists.

A. a corporate VMS
B. a channel captain
C. an administered VMS
D. a contractual VMS
E. horizontal channel integration

Answer 1

D. a contractual VMS

Step-by-step explanation:

• A contractual VMS is a Vertical Marketing System that is formed by the individual firms operating at different channel layers.

• Has integrated operations at a contractual basis and each layer helps in the achievement of the economy of scale by the integration of their operations.

• Hence they share their rights and responsibilities be it the producer, the wholesaler, or the retailer thus having all the elements of production and distribution channel fall in a single ownership in their legal agreements.