The majority of producers use different channels of distribution like intermediaries so that their products are availed to the market and reach the final consumer. Producers therefore create a marketing system (distribution channel) to achieve this.
A distribution channel is a system that is used by different organizations to make goods available to the targeted consumer (Rosenbloom, 2004). Additionally, channel intermediaries like wholesalers or retailers break the bulk between the producer and consumer. This paper focuses on distribution channels, organizations and lastly, an analysis of the target market’s needs.
Overview of Distribution Channels
- Direct distribution
A direct channel transfers goods directly from a producer to the consumer (Hill, 2010). This channel allows the producer to work with the consumer directly whereby the consumer enjoys benefits like price reduction as compared to a retailer. Producers can therefore reduce costs by avoiding intermediaries to protect the consumers from price increase by wholesalers and retailers above what consumers can afford to pay.
- Indirect distribution
This channel has one or more intermediary levels. A good example is the producer-retailer-consumer channel where the good has to pass through the distribution channels to reach the ultimate consumer (Hill, 2010).
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This paper has describes a distribution channel as a system that is used by different organizations to make goods available to the targeted consumer. Additionally, channel intermediaries like wholesalers or retailers break the bulk between the producer and consumer.
Anne T. Coughlan, Erin Anderson, Louis W. Stern, and Adel I. El-Ansary. (2001).
Marketing Channels, 6th ed. (Upper Saddle River, NJ: Prentice Hall, 2001).
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