Which of the following is an advantage of direct exports?

• A. Reduced need for market research
• B. Lower transportation costs compared to domestic sales
• C. Elimination of all trade barriers
• D. Greater control over marketing and sales activities

Answer: (D)

Verified step by step guidance

1. Understand the concept of direct exports: Direct exporting means a company sells its products directly to customers in a foreign market without intermediaries.
2. Identify typical advantages of direct exporting, such as greater control over marketing and sales activities, direct customer feedback, and potentially higher profit margins.
3. Analyze the given options: Reduced need for market research is unlikely because entering a foreign market usually requires more research; lower transportation costs compared to domestic sales is generally incorrect since international shipping tends to be more expensive; elimination of all trade barriers is not true because trade barriers depend on international agreements and regulations, not the export method.
4. Recognize that 'Greater control over marketing and sales activities' is a key advantage of direct exports because the company manages its own distribution and promotional strategies in the foreign market.
5. Conclude that the correct advantage of direct exports is the increased control over marketing and sales, which allows the exporting firm to tailor its approach to the foreign market more effectively.