Distribution (Place) Decisions

The main objective of Distribution (Place):

• To make products available in the right place at the right time in the right quantities

Key questions that influence distribution decisions:

• Where do customers buy and who from?

• How do customers buy?

• Sell directly or use intermediaries (distribution channels)?

• Is technology changing traditional distribution methods?

What is a distribution channel?

• A distribution channel moves a product through the stages from production to final consumption

  1. Producer

  2. Wholesaler

  3. Retailer

  4. Customer

• Each party in a distribution channel is called an ‘‘intermediary’’

  1. Producer

  2. Distributors/Agents

  3. Customer

• or

  1. Producer

  2. Customer

Main types of intermediaries in distribution channels:

• Retailer

• Wholesaler

• Distributor

• Agent

Multi-channel distribution:

• Multi-channel distribution involves a business using more than one type of distribution channel