Intermediaries

Question 1

Advantages

Answer 1

A producer can access many thousands of customers by selling to retailers which then distribute to their own stores or by selling to wholesalers which then sell them on.

Question 2

Advantages

Answer 2

By selling its products in other businesses’ stores, the producer enables the customer to compare what is on offer.

Question 3

Disadvantages

Answer 3

Intermediaries will want to make a profit so the price is increased at each stage. This makes the final product more expensive than if the producer sells directly to customers.

Question 4

Disadvantages

Answer 4

By selling the product on to someone else the producer loses control. An intermediary can promote the product as they choose then the producer may not approve of their displays, or descriptions, or even their store layout.