Which of the following is a disadvantage of selling via a distributor?

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Prepare for the WSET Diploma D2 Exam. Utilize flashcards and multiple choice questions with detailed hints and explanations. Equip yourself for success in your upcoming exam!

Multiple Choice

Which of the following is a disadvantage of selling via a distributor?

Explanation:
The important idea here is that using a distributor often cuts into your profits because they charge a fee or take a share of the price. That cost reduces your margin per unit and can limit price flexibility, especially if you’re trying to run promotions or maintain consistent pricing across markets. In contrast, the other points describe benefits distributors provide—their market knowledge, help with administration and logistics, and their ability to absorb some risk of lost or damaged stock—so they aren’t disadvantages.

The important idea here is that using a distributor often cuts into your profits because they charge a fee or take a share of the price. That cost reduces your margin per unit and can limit price flexibility, especially if you’re trying to run promotions or maintain consistent pricing across markets. In contrast, the other points describe benefits distributors provide—their market knowledge, help with administration and logistics, and their ability to absorb some risk of lost or damaged stock—so they aren’t disadvantages.

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