Question

A computer manufacturer is producing a one-of-a-kind innovation called Innovel, a cloud computing software that helps to navigate Internet content. While making the channel decision and finalizing the distribution arrangement, the manufacturer is keen on limiting the distribution of Innovel and gives only Techaven Inc. the rights to sell Innovel in that region. Techaven is known for its unique facilities and specialized inventories. In this case, the manufacturer is using the _____ arrangement of distribution.

A. selective
B. restrictive
C. exclusive
D. intensive

Answer 1

(A) Exclusive

Step-by-step explanation:

An organization is said to be using an exclusive distribution strategy when it plans to sell its products or services through only one distributor in a particular geographical region. Usually premium and exclusive products that enjoy large customer loyalty are sold through exclusive distribution strategy. For example, a premium brand such as Lamborghini might have only one distributor in a city or even in one whole country.

In the given scenario, a computer manufacturer has decided to limit the distribution of their new cloud computing software called “Innovel” to only one distributor, that is, Techaven Inc. Here, the computer manufacturer is using exclusive arrangement of distribution.