7. The United States has food service distributors that also replenish convenience stores. What are the pros and cons to having a distributor replenish convenience stores versus a company like Seven-Eleven managing its own distribution function?
Pros: The largest benefit of having a distributor replenish the store is that they don’t have to invest in DCs or trucks to perform this task.
Cons: The downside is the lack of control and the increased number of relationships that must be managed at the store level. Responsiveness may also not be as great. Some store managers will be more adept at managing these relationships than others, and service levels will not be consistent among the stores. This also creates more potential problems for upper management in overseeing the franchises to ensure consistent customer service.