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What is a distribution channel?
a distribution channel is the means by which a product is passed from the place of production to the customer.
what is distribution channel one and the advantages and disadvantages of distribution channel one?
Distribution channel one is when a product is passed directly to customers or by mail. the advantages are that it is simple to apply,it is suitable for certain type of products like food products which are sold straight from the farm,the cost is lower if sold directly to customers. However it is impractical for most products since customers dont live near the place of production,some products may not be suitable to be sent by mail,it can be expensive to send products by post or courier.
what is the 2nd distribution channel
The 2nd distribution channel involves producers first selling to retail outlets who then sell the products to customers.this is most common when retail is large and the products are expensive.
what are the advantages and disadvantages of the 2nd distribution channel.
The advantages are that producers sell large quanities to retailers.The distribution costs are reduced compared to directly selling to consumers.However there is no direct contact with customers and the price is often higher compared to direct selling since the retailer needs to cover his costs and make a profit.
what is the third distribution channel?
third distribution channel includes using a wholesaler who performs the function of breaking bulk.Breaking bulk is where wholesalers buy products from manufacturers in large quantities and then divide up the inventory into smaller quantities.
What are the advantages and disadvantages of the third distribution channel
Wholesaler saves storage space for small retailers and reduces storage costs,Small retailers can purchase fresh products in small quantities from wholesaler because they have a short shelf life before they deteriorate.wholesaler may deliver to retailers saving on transport costs. However it may be more expensive for small shops to buy from wholesalers then if it bought straight from the manufacturer,wholesaler may not have the full range of products to sell,wholesaler may be a long way from small shops.
what is distribution channel 4
distribution channel 4 involves an agent, when products are exported manufacturers hire an agent who is an independent firm or person that is appointed to deal with the sales and distribution of a product or range of products.
distribution channel 4 advantages and disadvantages.
the advantages are that manufacturers may not know the best way to sell the product in another market,agents will be more aware of the local conditions and will be in the best position to select the selling place. However the producer has less control over the way the product is sold to customers.
