Effect of Advertising on Distribution Costs

The total cost for any product is made up of the cost of production and the cost of selling and distribution. Advertising is a part of selling and distribution. Advertising is a part of selling and distribution costs. The costs of production and the costs of distribution costs increase, they proportionately go down as a percent and distribution costs. The costs of product and the costs of distribution show a different trend over a period of time. Though production costs increase, they proportionately go down as a percentage of the total cost. In other words, production costs increase at a lower rate than the increase in the distribution costs. This is natural in view of the improved technology which has streamlined production. This costs the improved technology which has streamlined production. The costs of distribution have been increasing considerably over the years. This is a natural corollary of increased competition.