Entrepreneurship and Small Business (ESB) Certification Practice Exam

What is the primary purpose of using direct distribution channels in a meal delivery service?

1. Enhancing product visibility

2. Lowering shipping cost and ensuring product freshness

3. Increasing product promotions

4. Expanding to international markets

The correct answer is: Lowering shipping cost and ensuring product freshness

The primary purpose of using direct distribution channels in a meal delivery service is to lower shipping costs and ensure product freshness. Direct distribution allows the company to manage the supply chain closely, providing greater control over the shipping process and reducing costs associated with intermediaries. By delivering meals directly to consumers, the service can minimize the time between preparation and delivery, which is crucial for maintaining the quality and freshness of food products. Freshness is a key factor in customer satisfaction within the food industry, and using direct channels helps achieve that. In contrast, enhancing product visibility generally involves marketing and promotional strategies rather than the distribution method itself. Increasing product promotions focuses on marketing activities rather than the logistics of distribution. While expanding to international markets pertains to the geographical reach of the business, it goes beyond the immediate goal of ensuring freshness and reducing costs tied to direct delivery.