A disadvantage(s)of indirect exporting is:
A)foreign business can be lost if exporter changes supply sources
B)no expertise or large cash outlays are required
C)the firm gains little experience from transactions
D)foreign business can be lost if exporter changes supply sources and the firm gains little experience from transactions
E)firms find it hard to set sales offices in foreign countries

Question

Quizplus · Accepted Answer

Indirect exporting involves using intermediaries such as agents, distributors, or trading companies to handle the export transactions. A disadvantage of this approach is that foreign business can be lost if the exporter changes supply sources. This is because the intermediary may have established relationships with suppliers or customers that are specific to the exporter's original supply source. Another disadvantage is that the exporter gains little experience from transactions because the intermediary is handling most of the export functions. Therefore, choice D is the best answer as it combines both of these disadvantages.

A Disadvantage(s)of Indirect Exporting Is