Distribution channel management

Distribution channel management is process of managing transfer of products from producer to end
customer. Distribution channel is the medium or channel which companies use to carry products. It is
a critical element in business as this process is used to distribute products to retailers & customers
across various locations.
Some of the main elements/ characteristics of an effective distribution channel management are:
1. Route: The most preferred route has to be selected depending on geography, locations, cost etc.
2. Flow: The flow of goods & services has to be addressed in a structured, systematic & sequential
manner, for a smooth execution.
3. Logistics: The selection of the type of logistics medium like rail, road, airways, waterways, pipeline
etc.
4. Levels: The different levels or intermediaries have to be finalized like wholesalers, retailers, agents
etc.

Distributors
Distributors are what links manufacturers to other parts of the supply chain, such as wholesalers,
resellers, and retailers.
Image: UnsplashThrough their direct relationships with manufacturers, distributors buy in bulk and
distribute products to a variety of merchants down the line.
Previously, these distributors would just sell to wholesalers. But, increasingly, distributors are also
selling straight to retailers, cutting out the intermediaries and reducing retail pricing.
Often, distributors will operate in particular regions and have relationships with wholesalers and
retailers in that specific market.
Example of a distributor
Distributors aren’t very well known to the general public, but a few notable companies are:
MSC Industrial Supply, which sells industrial equipment
Sysco, which sells food products
Cardinal Health, which sells pharmaceuticals

wholesaler
a wholesaler is the piece that usually sits between the distributor and the retailer.
They work with distributors (and sometimes manufacturers directly), buying goods in bulk to sell in
small quantities to retailers.
Wholesalers can offer a large variety of products or focus on a particular industry, such as apparel,
cosmetics, or kitchen supplies.
Where distributors enter into contracts with certain manufacturers, wholesalers can buy from
competing manufacturers to make up their inventory. For example, a cosmetics wholesaler could buy
from several competing brands.
To attract retail buyers, wholesale businesses use B2B marketplaces or their own online stores.
The benefits of using a wholesale marketplace is that businesses don’t have to do much marketing,
whereas those selling from a storefront need to use limited marketing channels to attract customers.
Wholesalers with their own stores can build a brand with a more loyal customer base, though.

retailer
retailer is a merchant that sells directly to consumers, often focusing on specific verticalsRetailers
work with wholesalers and distributors to maintain their inventory. They can even buy directly from
manufacturers, removing the go-betweens entirely, as shown by the wave of direct-to-consumer (DTC)
brands.
Since retailers sell goods directly to customers, they handle all the marketing, customer service,
returns, and exchanges. This represents an extra cost that gets built into the final price point.While
there are some major differences between wholesalers vs retailers, many brands have demonstrated
the ability to sell both B2C and B2B while maintaining their unique branding and budgeting much
more for marketing.
Factors effecting distribution strategy
Business Location
Location of the target market
Targets’ market reach
Distribution channel

Differences Between Retailers, Wholesalers, and Distributors

Inventory volume : retailers sell to consumers, wholesalers sell to retailers, and distributors sell to
wholesalers. Retailers buy small quantities of select items from a distributor or wholesaler.
Wholesalers buy a large quantity and variety of products directly from the distributor. Together, they
form a relationship to maintain a steady inventory flow at both ends.

Pricing structure : In addition to a difference in inventory volume, wholesalers also purchase products
from distributors at a discount. There is typically a mutually agreed-upon number of items purchased
or total spend on each order to receive the savings. This may apply to a single category, such as
electronics, or expand to a broader area like home goods, depending on retailer purchasing history.

Accessible inventory : From this broad selection of products, retailers then curate their stores based
on what their customers buy most. They use consumer data to replenish the products in the highest
demand and work with wholesalers that can provide the most competitive pricing. Another main
difference with how each part of the supply chain works depends on the business model the company
has set up.

international logistics
international logistics is the study, planning and implementation of how a business moves physical
goods and materials from supplier to customer in a way that involves crossing at least one
international border. It also includes the international movement of money and information. Said
another way, it’s simply business logistics that span two or more countries.

5 Factors Affecting Distribution Strategies

Business location.
The location of the target market.
Reach target market.
Warehouse.
Transportation and logistic
Modes of transportation

1. Maritime Transportation

Shipping by water has been practiced for thousands of years and remains pivotal to today’s global
trade. 90% of all international trade is accomplished through maritime transportation. Cargo ships
travel on almost every major body of water and have capacity to transport the highest volume of
freight of any mode of transportation at the lowest cost.

The routes available to container ships are calculated and strictly followed. Many routes used today
have been used for centuries. However, new routes are still being sought out and tested for optimal
supply chain efficiency. In the past few months, Maersk sent a cargo ship over the Arctic Circle for
the first time in history to explore the potential for increased efficiency in shipping routes.

The greatest disadvantage of maritime cargo ships is the speed at which they operate. By far,
maritime is the slowest mode of transportation. It is, however, the most efficient for the amount of
cargo it is capable of carrying. In practice today, the speed of ships compared to air can have great
significance when it comes to regulations and tariffs. As of January 2017 there were 52,183 cargo
ships in service; so at any given time there can be thousands of ships at sea. If a sanction is put in
place during a ship’s 40 days at sea, the operators have to either turn around or comply with a tariff
they were not prepared to pay. This has caused a lot of upset in the trade world recently.

2. Air Transportation

The newest mode of transportation is air. Airplanes are becoming increasingly important in domestic
and international trade. With continually improving technologies and practically unlimited route
possibilities, air transportation is the fastest growing and most time efficient shipping mode.
Consequently, many companies, such as Amazon and UPS, have purchased their own fleets of
airplanes to gain a competitive edge in the growing market.As air travel has become increasingly
advanced and dependable, more companies are trusting airplanes with high value freight and goods.
The increasing popularity of flight as a preferred way to travel also makes shipping by air more
convenient as shipments regularly piggyback on passenger planes, further making air an economic
way to transport goods.

There are a couple drawbacks to air transport. In its current state, air transport is still, by far, the
most expensive way to ship. Also, due to the nature of air travel, weight and volume of freight has to
stay minimal to ensure the safety of the flight. The level of emissions produced by air transport are
also the highest of any mode.

3. Rail Transportation

Rail transport is confined to a more limited infrastructure than road transport. As a defining trait,
locomotives (trains, monorails, etc.) are confined to a traced path going between point A and B with
very few points of divergence. Railways are costly and time consuming to construct and only a few
new railways have been constructed since the early 1900’s. Additionally, railways are limited to
semi-level geographic areas making construction increasingly laborious. Thus, railways are primarily
only accessible in large metropolitan areas. This attribute makes rail one of the primary players in the
intermodal transportation.

4. Intermodal Transportation (Multimodal)

Historically, intermodal presented many challenges for shippers and carriers; primarily, transferring
shipments between modes with maximum efficiency and minimal damage. With the advent of
containerization, intermodal has become much more efficient and safe. By creating a global system of
standardized containers, warehouses and shipping yards can safely and efficiently transfer containers
between road, rail, and maritime. The standard for intermodal containers is 8’ wide and 20’ or 40’
long. There is no set standard for height; however, most containers average 8.5’ in height.

In recent years, intermodal has experienced a substantial uptick. With rising freight rates and a
shortage of available truck drivers on the market, companies are turning to other modes, primarily
rail, to complete shipments. In a capacity crunch like this, companies scramble to see how they can
keep costs low while maintaining fulfillment promises.

5. Pipeline

Pipeline shipping is not a formal mode of transportation in the traditional sense. However, it is
important to acknowledge for its importance in the current fossil fuel market.

Pipelines transport unrefined fossil fuels such as gas and oil from their point of origin to the point
where they can then be transferred to the refineries or another mode of transportation. The cost of
shipping primarily lies in its construction, the diameter of the pipeline, and the viscosity of the fluid
being transported. They can be built above ground, underground, or underwater making them ideal
for offshore drilling.

The pumping of crude oil has risen in recent years the increasing need of transporting crude oil is
correlative with the increase in drilling and extraction Traditionally, the transporting of oil was
accomplished by rail but oil and gas companies are quickly turning to pipeline shipping because of
increased safety and efficiency. Regardless, the building of pipelines has been a topic of controversy
because of the environmental damage they will cause by increasing the speed of the oil industry,
creating additional fossil fuel emissions, and slow the progress of sustainable energy. The
controversies surrounding the Trans-Alaska pipeline are a prime example of this.

6. Road Transportation

The first, and most common mode of transportation in logistics, is road. From walking to horses to
wagons to bikes to cars to trucks, road transportation has been around longer than mode and is
utilized the most of any mode in logistics.

Sales manager role

Setting sales goals and quotas
Motivating and mentoring the team
Creating sales plans and workflows
Employing and onboarding new hires
Organizing sales training programs
Customer relationship management (CRM)
Pipeline management
Coordinating with sales enablement and marketing teams
Overall team management
Supply chain management focus on :