Question

Which of the following is NOT an option for remedying a cost disadvantage associated with activities performed by forward channel allies (wholesale distributors and retail dealers)?

a. Change to a more economical distribution strategy such as putting more emphasis on cheaper distribution channels (perhaps direct sales via the Internet) or perhaps integrating forward into company-owned retail outlets
b. Enhance differentiation through activities such as cooperative advertising) at the forward end of the value chain
c. Pressure distributors/dealers and other forward-channel allies to reduce their costs and markups
d. Insisting on across-the-board cost cuts in all value chain activities—those performed by suppliers, those performed in- house, and those performed by distributors/dealers
e. Collaborate with forward channel allies to identify win-win opportunities to reduce costs

Answer 1

Answer: d. Insisting on across-the-board cost cuts in all value chain activities—those performed by suppliers, those performed in- house, and those performed by distributors/dealers

Step-by-step explanation:

The cost disadvantage is from the forward channel allies and not an across the board problem which involves all value chain activities. As such, the solution should be garnered towards the forward channel allies.

Insisting on cuts in areas that could be already functioning efficiently could lead to a loss of that efficiency.

Insisting on across-the-board cost cuts in all value chain activities is therefore not an option for remedying a cost disadvantage associated with activities performed by forward channel allies.