Business Studies - Topic 14

Distribution channel

That means by which a product is passed from the place of production to the customer

Agent

An independent person or business that is appointed to deal with the sales and distribution of a product or range of products

What are advantages of producer to consumer?

Very simple

Lower prices for consumers

What are disadvantages of producer to consumer?

Expensive for some customers who live far

May not be suitable for some types of products

Lower sales as not many customers live near factories

What are advantages of producer to retailer to consumer?

Low distribution cause

Retailers hold inventory

What are disadvantages of producer to retailer to consumer?

No direct contact with customers

What are the advantages of particular producer to wholesaler to retailer to consumer?

Retailer can buy in small quantities

Lower storage cost for manufacturers and retailers

What are disadvantages of producer to wholesaler to retailer to consumer?

Wholesalers may not carry all products

high prices for retailers and consumers

Delays in reaching consumers

What are advantages of producer to agent to wholesaler to retailer to customer?

Agent have local business expertise

Producer save time on overseas distribution

What are disadvantages of producer to agent to wholesaler to retailer to customer?

Commission cost for producer

Loss of control over product sales