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Which of the following consequences is a result of shipping directly from the point of manufacture to the customer rather than through a distribution network?
It cannot be A, when you remove your distribution network, that means less stops for the delivery trucks, and therefore, the lead times should be reduced. The answer is B, since C & D are also wrong.
Distribution overhead may be negligibly small here, order fill rate is connected to the number of orders fulfilled (not exclusively mentioned about this here). Option A talks of delivery lead time consistency which may or may not be ensured (this assumes that use of distributors may cause delay/ lead time issues and simply because there is direct shipment from the manufacturer to the customer, there is no assurance regarding adherence to lead times). Option B talks of advantages of risk pooling which is the use of a central DC/ warehouse for multiple supply chains. This is not an option here due to absence of distribution channels and use of direct shipping to customers.
I would think risk pooling would be much better if firm is shipping frm mfg location.
So my understanding is answer should be A
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