Question

A major disadvantage of _____ is that they can seldom afford to make the kind of market investment needed to establish deep distribution for products.

1) export management companies
2) trading companies
3) import associations
4) global retailers
5) complementary marketers

Answer 1

Trading companies can seldom afford to make the kind of market investment needed to establish deep distribution for products. Therefore, the correct option is 2.

Step-by-step explanation:

The major disadvantage of trading companies is that they can seldom afford to make the kind of market investment needed to establish deep distribution for products. Trading companies are intermediaries that facilitate trade between buyers and sellers in different countries. They typically specialize in certain products or industries and help connect producers with potential customers in foreign markets.

However, trading companies often lack the financial resources to invest in extensive distribution networks, which can limit their ability to effectively reach consumers and compete with larger global retailers.