On The Concession To Operate The Distribution Mode Choice

This paper is a study of what is the best distribution method in franchising.This paper first analyzes the carrying cost and the transportation cost inintegrated distribution and non-integrated distribution, drawing the conclusionthat in integrated distribution the carrying cost decreases while thetransportation cost increases. Further studies indicate that integrateddistribution is the better choice in terms of logistics cost. Afterwards anexample is employed to verify the proposition above. Last this paperinvestigates several other factors that may have influence on distribution,drawing these final conclusions: integrated distribution is preferred as long asthe scale permits;distribution should be outsourced to third party logistics ifthere exists an ideal partner.