What Is a Distribution Expense in a Courier and Delivery Service?
Also referred to as distribution costs, this expense is a business cost which has to do with the transportation of any goods from facilities of the manufacturer to locations that they are usually bought from. This kind of expense can take many forms, depending on the methods which are used to finish a sale including any intermediaries used as part of the delivery process. Plus, it is possible to have distribution expenses when delivering to a buyer.
One of the most basic examples can be seen when a sale is done. The process of direct sales is the interaction between a manufacturer and a consumer. With this, the buyer will put in an order with the seller, without a retailer functioning as a medium. Once a seller has accepted the order, then arrangements will be made to deliver the goods to the buyer, usually via a courier and delivery service. These costs may be paid by the seller or passed to the buyer as a package deal.
The scope of the expense could include costs apart from transportation fees. In the event that special handling is needed in transit, these extra costs will be looked at also. For situations that involve expedited shipping, like overnight delivery, those fees are considered above the normal process.
Also depending on the nature of a business, some or all of the expense can be paid by the manufacturer. This can sometimes be the case with direct sales, when the seller will provide free shipping as part of an incentive for doing business with them. This kind of arrangement is usually included with bulk ordering, which makes it more cost effective to offer. Other companies negotiate special rates with numerous courier and delivery service vendors; however, pass on the reduced cost to their clients, as shipping and handling fees are looked at when the order is placed.
Call Marathon Messenger Service today at (323) 285-0071, we are in the Los Angeles, CA region.