Distribution and Marketing Logisitics Manufacturers that have been selling to wholesalers and other intermediaries occasionally decide...

Distribution and Marketing Logisitics

Manufacturers that have been selling to wholesalers and other intermediaries occasionally decide to start selling directly to end customers, which of course puts them in competition with the channel partners that have been selling for them. Even if this is legal, do you think such moves are ethical? Why or why not?

Expert Solution

I do not believe that these moves are ethical. Even though this is legal and we have seen many manufacturers selling directly to the customers so that their costs could be reduced and they could earn more profits, this is unethical because these simply means that you are eliminating the middlemen. The middlemen and the intermediaries have already been put into crisis when online businesses like Amazon is making the delivery done directly to the customers from the manufacturer. Because of the same, the middlemen are losing their jobs, the level of unemployement is increasing and they have no where to go. Also, the profit sharing is also reduced in this case making the manufacturer to increase its profit margin without giving further stakeholders to share they deserve. Thus, it is important to include intermediaries and wholesellers atleast at one level to make sure more customers could be reached, more markets could be explored, more information and market data could be attained and also more investment and networks could be created by your business including more people in it.

keosha answered 1 year ago

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