UGC NET COMMERCE June 2019 Q86
0. The channel alternative is NOT to be assessed on the basis of:
- Option : D
- Explanation : Major Channel Alternatives: Companies can choose from a wide variety of channels for reaching customers - from sales forces to agents, distributors, dealers, direct mail, etc. Most companies now use a mix of channels where each channel reaches a different segment of buyers and delivers the right products to each at the least cost.
Evaluation of the Channel Alternatives:
Each channel alternative can be evaluated against the following criteria:
(i) Economic Criteria: Each alternative channel design will result in different levels of sales and cost as shown in Figure.
For level of sales below X1 (as shown in the figure above) provider’s sales agency will have economic advantage over their own sales force. But when the level of sales increases above the level X1, the company’s sales force will be more economical.
(ii) Control and Adaptive Criteria: The channel alternatives are evaluated in terms of companies having better
