International Channels, Logistics and E-Commerce

Introduction

International marketing does not end when a customer decides to buy. A market offering creates value only when the product, information, payment, and service reach the customer in the promised condition, place, time, and form. Distribution therefore links marketing strategy with operations, commercial law, technology, and customer experience.

International distribution is especially complex because firms must coordinate across borders, currencies, legal systems, transport networks, languages, customs regimes, and different expectations about delivery and service. A company may sell directly through its website, appoint importers and distributors, use agents or retailers, participate in digital marketplaces, or combine several routes in an omnichannel system. Each choice affects control, cost, speed, risk, data access, and channel relationships.

This chapter explains how managers design and govern international channels, select partners, use Incoterms, manage customs and logistics, control inventory and last-mile delivery, build resilient supply chains, and evaluate cross-border e-commerce.

Learning Objectives

By the end of this chapter, students should be able to:

1. Distinguish direct, intermediary, omnichannel, and marketplace distribution.
2. Design an international channel using customer, product, market, and company criteria.
3. Analyse channel power, conflict, governance, and partner performance.
4. Apply Incoterms conceptually and distinguish delivery obligations from transfer of ownership.
5. Explain customs, documentation, inventory, transport, and last-mile decisions.
6. Evaluate supply-chain resilience and cross-border e-commerce models.
7. Recommend a channel and logistics system for a realistic international market.

1. The Role and Structure of International Channels

A marketing channel is a set of organisations and activities that makes an offering available to users. A channel performs transactional functions—buying, selling, negotiating, financing, and assuming risk—as well as logistical functions such as transport, storage, sorting, consolidation, and order fulfilment. It also performs facilitating functions, including market information, promotion, credit, installation, returns, and after-sales service.

A simple channel may be represented as:

Manufacturer → Customer

A more complex arrangement may be:

Manufacturer → Export agent → Importer/distributor → Retailer → Customer

Digital channels do not eliminate intermediaries; they often replace traditional intermediaries with platforms, payment providers, fulfilment operators, comparison services, and digital advertising networks. The relevant question is not whether intermediaries exist, but which institutions perform each function and who controls the customer relationship.

Direct and intermediary channels

In a direct channel, the producer sells to the final customer through its sales force, website, mobile application, showroom, or owned social-commerce operation. Direct distribution can provide customer data, pricing control, brand consistency, and closer feedback. It also requires investment in demand generation, payment, fulfilment, customer service, compliance, and returns.

Intermediary channels use independent organisations such as agents, distributors, wholesalers, retailers, franchisees, brokers, and marketplaces. They can provide local knowledge, established relationships, warehousing, sales coverage, credit, and regulatory capability. Their disadvantages may include lower margins, weaker data access, competing priorities, and reduced control over presentation and service.

An agent normally facilitates sales without taking title to inventory, whereas a distributor generally purchases and resells products, accepting inventory and often credit risk. Actual legal arrangements vary by jurisdiction; managers must examine contracts rather than rely solely on labels.

Channel design criteria

Channel design should begin with customer value rather than with a preferred type of intermediary. Important questions include:

• How do target customers search, purchase, receive, use, and return the product?
• What delivery speed, availability, installation, and service do they expect?
• Is the product perishable, fragile, bulky, regulated, technical, or high-value?
• How concentrated are customers and how developed is local infrastructure?
• Does the firm possess local sales, logistics, compliance, and service capabilities?
• What degree of control over price, brand, data, and experience is strategically necessary?
• What channel costs and risks are acceptable?

Channel intensity describes the breadth of market coverage. Intensive distribution seeks availability through many outlets and is common for convenience products. Selective distribution uses a limited number of capable partners. Exclusive distribution grants a territory or category to one or a few partners and may support premium positioning, although competition law and contractual fairness must be considered.

A useful analytical principle is to match channel functions with the party best able to perform them at acceptable total cost and risk. Total cost includes not only freight and commissions but also inventory, customs, returns, service failures, compliance, technology, and management time.

2. Omnichannel and Marketplace Distribution

Multichannel marketing uses two or more channels. Omnichannel management goes further: it seeks to integrate channels so that the customer experiences a coherent brand, offer, inventory position, payment process, and service system. A customer may discover a product on a social platform, compare it on a marketplace, buy through a website, collect it from a store, and return it through a different channel.

Omnichannel design requires decisions about:

• common or differentiated pricing;
• customer identity and consented data integration;
• real-time or near-real-time inventory visibility;
• order routing and allocation;
• click-and-collect and ship-from-store;
• cross-channel returns and refunds;
• responsibility for customer service;
• attribution of sales and channel credit.

A marketplace connects buyers and sellers and usually provides search, payment, trust mechanisms, ratings, advertising, and sometimes fulfilment. Its advantages include rapid access to demand, local traffic, payment acceptance, and consumer trust. Its risks include platform fees, algorithmic dependence, counterfeit goods, data restrictions, price transparency, sudden policy changes, and direct competition with other sellers.

A brand should not treat marketplace participation as merely an advertising decision. It is a strategic channel decision involving assortment, authorised sellers, content standards, pricing governance, fulfilment service levels, and the protection of intellectual property.

Channel conflict and governance

Conflict occurs when channel members perceive that another member threatens their goals. Common causes include territorial overlap, inconsistent prices, direct selling by the manufacturer, parallel imports, allocation shortages, and disagreements about promotional funding.

Governance mechanisms include written territories and customer definitions, minimum service standards, transparent incentive systems, joint business planning, dispute-resolution procedures, authorised online seller policies, and shared demand information. Excessive control may motivate partners to disengage; insufficient control may damage the brand. Effective governance combines contractual rules with relational mechanisms such as trust, communication, and joint problem solving.

Channel power is the ability of one member to influence another. It may arise from reward power, coercive power, legitimate contractual authority, expert knowledge, referent reputation, or control of scarce resources such as customer data and traffic. Power is not automatically harmful. It becomes problematic when used opportunistically, unfairly, or in ways that undermine competition or partner viability.

3. Selecting and Managing International Partners

Partner selection is a strategic risk decision, not simply a search for the largest distributor. A structured process normally includes market mapping, qualification, due diligence, commercial evaluation, pilot operations, contract design, onboarding, and continuing review.

Partner evaluation criteria

Relevant criteria include:

A weighted score can support structured judgement. If criterion weights sum to 1, a simple score is:

where S is the total partner score, wᵢ is the weight assigned to criterion i, and rᵢ is the partner’s rating on that criterion. Ratings must use a defined scale, such as 1–5. The method assumes criteria are sufficiently comparable and that additive scoring is appropriate; it should not override a disqualifying legal or ethical failure.

For example, suppose market capability has weight 0.30 and rating 4, operations 0.25 and rating 5, financial strength 0.20 and rating 3, compliance 0.15 and rating 5, and digital capability 0.10 and rating 4. The score is:

S = (0.30×4)+(0.25×5)+(0.20×3)+(0.15×5)+(0.10×4) = 4.15

The result is meaningful only relative to the scale and competing candidates. A high score cannot compensate for a failed sanctions screening or an unacceptable corruption risk.

Contract and performance management

An international channel agreement should clarify territory, customer segments, exclusivity, prices or recommended pricing boundaries, forecasts, minimum service levels, inventory ownership, payment terms, intellectual property, data use, compliance, product liability, returns, warranties, termination, dispute resolution, and applicable law. Local legal advice is essential because agency, competition, consumer-protection, franchise, and distribution laws differ.

Performance dashboards may include sales growth, numeric and weighted distribution, order fill rate, on-time delivery, inventory days, forecast accuracy, return rate, complaint resolution, digital content quality, and compliance incidents. Targets should be jointly understood and should not encourage unsafe inventory loading, misleading promotions, or concealment of service failures.

4. Incoterms, Customs, and International Trade Responsibilities

Incoterms are standardised trade terms published by the International Chamber of Commerce. They allocate specified responsibilities, costs, and risks between seller and buyer for delivery, transport arrangements, export and import formalities, insurance in selected terms, and documentation. They do not, by themselves, determine ownership transfer, payment, product specifications, remedies, or all contractual obligations.

Managers must name the rule, place, and version precisely—for example, “CIP [named place], Incoterms® 2020.” The named place matters because it identifies where a cost or risk obligation is performed. Incoterms should be selected only after considering transport mode, infrastructure, customs capability, insurance, and bargaining power.

The rules can be grouped broadly as follows:

• EXW places substantial obligations on the buyer and may be unsuitable where the seller must handle export formalities.
• FCA is widely useful for containerised and multimodal shipments because the seller delivers to a carrier or other named place and handles export clearance.
• CPT and CIP involve carriage paid by the seller; CIP also includes a higher insurance obligation under the 2020 rules than some other insurance terms.
• DAP requires the seller to deliver to a named destination ready for unloading, while the buyer normally handles import clearance and duties.
• DDP places maximum delivery responsibility on the seller, including import clearance and duties, but may be impractical or legally restricted where the seller cannot act as importer.
• FOB, CFR, and CIF are intended primarily for sea or inland-waterway transport where delivery is linked to loading on board; they should not automatically be used for container shipments handed to a terminal before loading.

Customs compliance requires accurate product classification, customs value, origin, quantity, description, licences, and supporting documents. A commercial invoice, packing list, transport document, certificates, permits, and electronic declarations may be required. Rules of origin are particularly important: the country from which goods are shipped is not always the country of origin for tariff purposes.

Errors can cause delays, penalties, seizure, unexpected duties, customer dissatisfaction, and reputational damage. A robust process assigns responsibility for classification, maintains product master data, checks restricted-party requirements, and periodically audits brokers and declarations.

5. Logistics, Inventory, and Last-Mile Delivery

International logistics coordinates the movement and storage of goods and related information from source to customer. The main transport modes differ in speed, cost, capacity, reliability, and environmental impact. Ocean transport generally offers low unit cost and high capacity but longer transit times. Air transport is fast and suitable for urgent or high-value goods but is expensive and emissions-intensive. Rail, road, and multimodal combinations may balance cost and speed depending on geography.

A logistics design should consider total landed cost rather than freight alone. Total landed cost may include product cost, packaging, inland transport, export charges, freight, insurance, duties, taxes, brokerage, warehousing, handling, payment fees, returns, and expected loss from damage or obsolescence. The accounting treatment of some items varies by firm and jurisdiction, so the calculation should be defined consistently.

Inventory decisions

Inventory protects customer service against uncertain demand and replenishment time, but it ties up capital and creates obsolescence and storage costs. A basic reorder point model is:

where ROP is the reorder point in units, d is average demand per time period, L is replenishment lead time in the same time unit, and SS is safety stock in units. The model assumes demand and lead time are represented adequately by their averages and that replenishment is triggered when available inventory reaches the reorder point.

If average demand is 120 units per day, lead time is 10 days, and safety stock is 300 units, then:

ROP = (120×10)+300 = 1,500 units.

Safety stock should reflect desired service, demand variability, lead-time variability, and the cost of stockouts and excess inventory. A simplified statistical expression for safety stock under independent, normally distributed demand during a fixed lead time is:

where z is the chosen service-factor value, σ is the standard deviation of demand per time period, and L is fixed lead time in periods. This formula assumes independent demand periods, stable variability, and an appropriate normal approximation. If lead time is variable, demand is intermittent, or products are perishable, more suitable models or simulation may be required.

Last mile and returns

The last mile is often the most expensive and customer-visible part of delivery. Density, failed delivery attempts, address quality, urban congestion, local carrier capability, and customer availability affect performance. Options include home delivery, parcel lockers, pickup points, store collection, scheduled delivery, and local fulfilment. Managers should balance speed promises with actual network capability; an ambitious promise that is frequently missed damages trust more than a realistic slower promise.

Returns are a strategic part of the customer proposition, especially in fashion, electronics, and marketplaces. The system should define eligibility, return labels, inspection, refurbishment, resale, recycling, refunds, and responsibility for cross-border taxes. Reverse logistics can reduce waste and recover value, but it also introduces transport cost and fraud risk.

6. Supply-Chain Resilience and Risk Governance

Efficiency seeks low cost and smooth utilisation; resilience seeks the ability to anticipate, absorb, recover from, and adapt to disruption. Relevant disruptions include port closures, extreme weather, pandemics, cyberattacks, geopolitical conflict, strikes, supplier insolvency, regulatory changes, and sudden demand shifts.

Resilience does not mean duplicating every activity at any cost. It involves identifying critical nodes and vulnerabilities, then selecting proportionate responses. Practices include multi-sourcing, qualified alternative suppliers, regional or postponement strategies, strategic buffers, flexible transport contracts, supplier financial monitoring, business-continuity plans, cyber controls, and visibility beyond tier-one suppliers.

A risk register can assess probability, impact, detectability, and response ownership. Quantitative risk estimates must be treated cautiously: a simple expected-loss calculation is:

where E(L) is expected loss, pⱼ is the estimated probability of disruption scenario j, and cⱼ is its consequence cost. This is useful for comparison when probabilities and costs are credible, but it can understate systemic events, correlation between risks, and non-financial effects.

Visibility is a governance capability, not merely a tracking screen. Firms should know supplier dependencies, inventory locations, shipment status, customs events, temperature or condition where relevant, and the decision rights for escalation. Artificial intelligence can support demand forecasting, anomaly detection, route optimisation, and document processing. However, models require reliable data, human oversight, explainable escalation, privacy protection, and testing for bias. Automation should not conceal uncertainty or transfer accountability to software.

7. Cross-Border E-Commerce

Cross-border e-commerce includes transactions in which the buyer and seller are located in different countries. Models include business-to-consumer exports, marketplace selling, business-to-business portals, subscriptions, digital services, and social commerce. Success depends on more than translating a website. Customers need localised value propositions, currency and payment options, transparent delivery dates, duties and taxes, customer support, reviews, legal notices, and convenient returns.

A cross-border e-commerce operating model must decide:

1. whether to sell from the home country or hold stock locally;
2. whether the firm, marketplace, or logistics provider acts as importer;
3. how duties and taxes are calculated and disclosed;
4. which payment and fraud controls are used;
5. how personal data is collected, transferred, stored, and deleted;
6. how product safety, labelling, accessibility, and consumer rights are met;
7. how counterfeit and unauthorised seller risks are controlled.

Digital conversion should be interpreted together with fulfilment performance. A high checkout conversion rate is not commercially healthy if cancellations, customs charges, failed deliveries, or returns are excessive. Useful metrics include delivered-on-time rate, checkout conversion, contribution margin by order, customer acquisition cost, return rate, customs exception rate, customer effort, and repeat purchase.

Contribution margin per order can be expressed as:

where CM is contribution margin, R is revenue collected from the order, and V is variable cost attributable to that order. Depending on the managerial purpose, V may include product cost, payment fees, fulfilment, freight subsidy, marketplace commission, customer acquisition cost, expected returns, and support. Fixed costs should not be included if the measure is intended to assess short-run contribution. The definition must be consistent when comparing markets.

Applied Case: Northstar Outdoor Equipment

Background

Northstar Outdoor Equipment is an illustrative mid-sized manufacturer of premium hiking stoves based in Country A. It has strong domestic retail distribution and wants to enter Country B, where customers are experienced online shoppers. Country B has strict product-safety labelling, a capable parcel network, and a large marketplace, but customers expect rapid delivery and simple returns.

Problem

Northstar’s initial proposal is to appoint one national distributor with exclusivity, ship large quarterly consignments under a seller-favourable delivery term, and allow the distributor to manage all online listings. Management expects low administrative complexity but is concerned about loss of customer data and inconsistent brand presentation.

Analysis

The product is compact, durable, technical, and safety-sensitive. Customers need reliable product information, spare parts, and warranty support. A single distributor could provide local inventory, retailer access, and regulatory knowledge, but full exclusivity creates dependency and may reduce Northstar’s learning. Marketplace sales could generate reach quickly, yet uncontrolled third-party listings could create counterfeit and price-integrity problems.

The team evaluates three alternatives: (1) exclusive distributor only; (2) direct website with cross-border fulfilment; and (3) a hybrid model using a carefully governed distributor, Northstar’s localised website, and one authorised marketplace account. The hybrid model offers market coverage and learning while retaining some direct customer contact.

Approach and solution

Northstar conducts compliance and financial due diligence on two distributors, verifies product classification and safety requirements, and appoints the stronger candidate for an initial non-exclusive eighteen-month term. The agreement defines authorised channels, service levels, warranty responsibilities, data sharing subject to consent and applicable law, minimum training, and quarterly business reviews.

Northstar uses a delivery term appropriate to the agreed transport mode and named place after obtaining legal and customs advice, rather than selecting a term merely because it appears convenient. The contract separately addresses ownership, payment, title, and remedies because the delivery term does not settle all of these issues.

The firm holds safety stock in Country B through a third-party logistics provider. It lists products on the marketplace through an authorised account, uses standardised content, monitors unauthorised sellers, and offers a local return address. Its website explains delivery charges, estimated taxes, warranty procedures, and return conditions before payment. A dashboard tracks order fill, on-time delivery, stockouts, return reasons, marketplace ratings, contribution margin, and compliance incidents.

Outcome

In the first six months, Northstar gains faster customer feedback and reduces delivery time compared with shipping every order from Country A. The distributor supplies specialist retailers while the direct website captures service and product-use information. The company discovers that spare-part availability, not headline delivery speed, is the strongest driver of repeat purchase. It therefore increases local spare-parts inventory and trains the distributor’s service staff.

Learning points

The case demonstrates that channel design is a portfolio decision. Exclusivity can simplify coordination but creates dependency. A hybrid channel can combine reach with learning, but only if pricing, data, inventory, service, and partner responsibilities are governed explicitly. Logistics and customer experience must be designed together, and Incoterms must not be confused with the entire sales contract.

8. Ethical, Legal, and Sustainability Considerations

International channel decisions affect workers, communities, consumers, and the environment. Ethical governance requires anti-bribery controls, fair treatment of suppliers, responsible recruitment, safe working conditions, accurate product claims, protection of consumer data, and mechanisms for reporting misconduct. Distributor due diligence should examine beneficial ownership, government relationships, commissions, gifts, and unusual payment requests.

Sustainability decisions include packaging reduction, transport-mode choice, route density, repairability, product life extension, reverse logistics, and emissions reporting. Managers should avoid unsupported claims such as “carbon neutral” or “green delivery.” A lower-emission option may increase delivery time or cost, so the trade-off should be communicated honestly.

Privacy and data rules apply to customer identity, location, behaviour, payment, and device information. Consent, purpose limitation, security, retention, cross-border transfer controls, and access rights must be addressed according to applicable law. Marketplace and algorithmic governance should also consider discriminatory ranking, opaque suspension, fake reviews, and unequal access to platform visibility.

Best-Practice Decision Framework

A practical international channel decision can follow these stages:

1. Define customer jobs, service expectations, and target-market constraints.
2. Map channel functions from demand generation through returns.
3. Compare direct, intermediary, marketplace, and hybrid alternatives.
4. Estimate total landed cost, required investment, risk, and data consequences.
5. Screen partners for capability, integrity, compliance, and strategic fit.
6. Design contracts, Incoterms, customs responsibilities, service standards, and escalation rules.
7. Pilot at manageable scale and measure customer and operational outcomes.
8. Build inventory, fulfilment, returns, cybersecurity, and continuity plans.
9. Review performance and rebalance channels as market conditions change.

The strongest design is rarely the one with the fewest intermediaries or the lowest freight rate. It is the design that delivers the promised value reliably while preserving economic viability, legal compliance, learning, and resilience.

Chapter Summary

International channels connect a firm’s value proposition with customers through direct routes, intermediaries, marketplaces, and integrated omnichannel systems. Channel design should match customer expectations and required functions with the capabilities of the firm and its partners. Partner selection requires commercial, operational, financial, digital, compliance, and ethical due diligence.

Channel governance manages power, conflict, incentives, data, pricing, service, and accountability. Incoterms allocate specified delivery responsibilities, costs, and risks, but they do not replace the full sales contract or automatically determine ownership. Customs accuracy, total landed cost, inventory policy, transport selection, last-mile design, and returns strongly influence customer experience and profitability.

Resilient supply chains balance efficiency with visibility, alternatives, buffers, continuity planning, and adaptive capability. Cross-border e-commerce requires localised customer experience, payment and tax clarity, regulatory compliance, reliable fulfilment, platform governance, and careful data management. Managers should evaluate channels using both financial metrics and measures of service, risk, ethics, sustainability, and long-term learning.

Key Terms

Channel: The organisations and activities that make an offering available to users.

Direct channel: A route in which the producer sells to the final customer without a traditional reseller.

Intermediary: An organisation that performs channel functions between producer and customer.

Distributor: An intermediary that commonly purchases and resells inventory.

Agent: An intermediary that normally facilitates transactions without taking title to inventory.

Channel intensity: The breadth of market coverage sought by a firm.

Omnichannel: Integrated management of multiple channels to provide a coherent customer experience.

Marketplace: A platform that connects multiple buyers and sellers.

Channel power: The ability of one channel member to influence another.

Channel conflict: Perceived incompatibility among channel members’ goals or actions.

Incoterms: International trade rules allocating specified delivery responsibilities, costs, and risks.

Customs value: The value used by customs authorities to assess duties and related obligations.

Rules of origin: Criteria used to determine the origin of goods for trade purposes.

Total landed cost: The complete cost of making goods available at the intended destination.

Reorder point: The inventory level at which replenishment should be initiated.

Safety stock: Inventory held to protect against demand or supply uncertainty.

Last mile: The final movement of an order to the customer or collection point.

Resilience: The capacity to anticipate, absorb, recover from, and adapt to disruption.

Cross-border e-commerce: Online trade in which buyer and seller are located in different countries.

Contribution margin: Revenue minus defined variable costs attributable to an order or activity.

Review Questions

Short Answer Questions

1. What are the principal advantages and disadvantages of direct international distribution?
2. How does an agent differ from a distributor?
3. Why should Incoterms not be treated as a complete sales contract?
4. What is the purpose of safety stock?
5. Identify four risks associated with international marketplaces.

Long Answer Questions

1. Explain the criteria a firm should use when designing an international channel strategy.
2. Discuss the causes of channel conflict and evaluate mechanisms for governing it.
3. Explain how customs, Incoterms, and total landed cost interact in an international shipment.
4. Compare efficiency and resilience in international supply-chain management.
5. Evaluate the operational and strategic requirements of a cross-border e-commerce model.

Analytical / Application Questions

1. A firm sells technical medical equipment in a market with dispersed hospitals, strict regulation, and limited local service capability. Recommend a channel structure and justify the allocation of sales, inventory, compliance, and after-sales functions.
2. Average demand is 80 units per day, replenishment lead time is 12 days, and safety stock is 250 units. Calculate the reorder point using ROP = dL + SS, and explain two reasons why the result might require adjustment.
3. A marketplace offers rapid market access but demands high commissions and restricts customer-data access. Analyse whether a manufacturer should use the marketplace, its own website, or a hybrid model. Include financial, customer-experience, governance, and resilience considerations.

Multiple Choice Questions with Answers

Question 1

Which channel arrangement gives a producer the greatest direct control over customer data and brand presentation?

A. Direct online sales

B. Independent wholesaler sales

C. Agent-mediated sales

D. Traditional retailer sales

Correct Answer: A. Direct online sales

Question 2

What is a principal function of an international distributor?

A. Only translating advertising copy

B. Purchasing and reselling inventory, often with local market support

C. Issuing government passports

D. Setting another firm’s corporate tax rate

Correct Answer: B. Purchasing and reselling inventory, often with local market support

Question 3

Which statement about Incoterms is correct?

A. They automatically determine ownership transfer in every sale

B. They replace product-safety regulations

C. They allocate specified delivery responsibilities, costs, and risks

D. They eliminate the need for customs documentation

Correct Answer: C. They allocate specified delivery responsibilities, costs, and risks

Question 4

If average demand is 100 units per day, lead time is 8 days, and safety stock is 200 units, what is the reorder point?

A. 800 units

B. 900 units

C. 1,000 units

D. 1,200 units

Correct Answer: C. 1,000 units

Question 5

Which activity most directly supports supply-chain resilience?

A. Depending on one untested supplier

B. Removing all inventory buffers

C. Developing qualified alternative sources

D. Ignoring tier-two suppliers

Correct Answer: C. Developing qualified alternative sources

Question 6

What distinguishes omnichannel distribution from merely multichannel distribution?

A. Omnichannel uses only physical stores

B. Omnichannel integrates channels into a more coherent customer experience

C. Omnichannel prohibits marketplaces

D. Omnichannel always has lower logistics cost

Correct Answer: B. Omnichannel integrates channels into a more coherent customer experience

Question 7

Which issue is especially relevant when selecting a cross-border marketplace?

A. Platform dependence and restricted access to customer data

B. The absence of any customer reviews

C. Guaranteed ownership of all marketplace traffic

D. Automatic exemption from consumer law

Correct Answer: A. Platform dependence and restricted access to customer data

Question 8

Which cost is normally relevant to total landed cost?

A. Only the factory wage bill

B. Only the international freight charge

C. Duties, brokerage, transport, handling, and related delivery costs

D. Only the retailer’s advertising budget

Correct Answer: C. Duties, brokerage, transport, handling, and related delivery costs

Question 9

A channel member’s ability to influence another because it controls scarce customer traffic is an example of what?

A. Resource-based channel power

B. Random demand variation

C. Customs valuation

D. Reverse logistics

Correct Answer: A. Resource-based channel power

Question 10

What is a sound cross-border e-commerce practice?

A. Disclosing delivery and tax conditions only after payment

B. Combining localised information with transparent fulfilment and returns

C. Allowing unauthorised sellers to control product claims

D. Treating customs compliance as the customer’s problem in every case

Correct Answer: B. Combining localised information with transparent fulfilment and returns