Reynold's, a supermarket chain, carries the K-Nine range of dog food manufactured by JGB. However, the chain does not interact directly with JGB, but obtains stocks from wholesalers
It has been suggested that Reynold's save costs by sourcing products directly from JGB. However, Mal, the CEO of the Reynold's, insists that wholesalers are the most hassle-free option for Reynold's. What can Mal say to justify this?
Student answers may vary.
Mal can justify this using any or all of the following reasons:
Wholesalers are able to select items and build the assortments Reynold's needs, saving Reynold's considerable work.
Wholesalers achieve savings for Reynold's by buying large carload lots and breaking the bulk into smaller units.
Wholesalers hold inventories, thereby reducing inventory costs and risks for Reynold's, who needn't hold the inventory for itself.
Wholesalers finance Reynold's by granting credit.
Wholesalers supply information regarding competitors' activities, new products, price developments, and so on.
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