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Distribution Channel

This document discusses distribution channels, which refers to the methods used by a company to deliver products or services to consumers. Distribution channels can involve manufacturers, wholesalers, retailers, and direct sales. There are two main types of channels - direct channels allow consumers to purchase directly from manufacturers, while indirect channels involve wholesalers or retailers. The three common types of distribution channels are wholesalers, retailers, and direct-to-consumer sales. It is important for companies to choose the right distribution channel that aligns with their strategic goals and adds value for consumers.

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234 views8 pages

Distribution Channel

This document discusses distribution channels, which refers to the methods used by a company to deliver products or services to consumers. Distribution channels can involve manufacturers, wholesalers, retailers, and direct sales. There are two main types of channels - direct channels allow consumers to purchase directly from manufacturers, while indirect channels involve wholesalers or retailers. The three common types of distribution channels are wholesalers, retailers, and direct-to-consumer sales. It is important for companies to choose the right distribution channel that aligns with their strategic goals and adds value for consumers.

Uploaded by

Acna Rome
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Distribution Channel

Introduction

• What Is a Distribution Channel?


• Understanding Distribution
Channels
• Direct and Indirect Channels
• Types of Distribution Channels
• Choosing the Right Distribution
Channel
What Is a Distribution Channel?
A distribution channel is a chain of businesses or
intermediaries through which a good or service passes until it
reaches the final buyer or the end consumer. Distribution
channels can include wholesalers, retailers, distributors, and
even the internet.

The term “distribution channel” refers to the methods


used by a company to deliver its products or services to the
end consumer. It often involves a network of intermediary
businesses such as manufacturers, wholesalers, and retailers.
Selecting and monitoring distribution channels is a key
component of managing supply chains.
Understanding Distribution Channels
A distribution channel is a path by which all goods and services must
travel to arrive at the intended consumer. Conversely, it also describes the
pathway payments make from the end consumer to the original vendor.
Distribution channels can be short or long, and depend on the number of
intermediaries required to deliver a product or service.

Goods and services sometimes make their way to consumers through


multiple channels—a combination of short and long. Increasing the number
of ways a consumer is able to find a good can increase sales.
Direct and Indirect Channels
Channels are broken into two different forms
—direct and indirect. A direct channel allows
the consumer to make purchases from the
manufacturer while an indirect channel allows
the consumer to buy the goods from a
wholesaler or retailer. Indirect channels are
typical for goods that are sold in traditional
brick-and-mortar stores.
Types of Distribution Channels
The three types of distribution channels are wholesalers, retailers,
and direct-to-consumer sales. Wholesalers are intermediary
businesses that purchase bulk quantities of product from a
manufacturer and then resell them to either retailers or—on some
occasions—to the end consumers themselves. Retailers are generally
the customers of the wholesalers and offer high-touch customer
service to the end customers. Lastly, direct-to-consumer sales occur
when the manufacturer sells directly to the end customer, such as
when the sale is made directly through an e-commerce platform.
Choosing the Right
Distribution Channel
Not all distribution channels work for all products,
so it's important for companies to choose the right
one. The channel should align with the firm's overall
mission and strategic vision including its sales goals.
The method of distribution should add value to the
consumer. Do consumers want to speak to a
salesperson? Will they want to handle the product
before they make a purchase? Or do they want to
purchase it online with no hassles? Answering these
questions can help companies determine which
channel they choose.
Thank you!!

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