– Distribution channels

• Businesses (intermediaries) involved in moving goods from the manufacturer to the point of sale.
• Intermediaries can be wholesalers or retailers.
• Three main types of channels:
• Producer to consumer – involves no intermediaries; the good or service is produced by an individual/organisation and is then passed directly onto the consumer eg service industries.

• Producer to retailer to consumer – retailer is the intermediary and accesses goods from the producer, usually in bulk then sells to consumer.
• Producer to wholesaler to retailer to consumer – wholesaler buys in bulk from producer and resells in smaller quantities to retailers.

– Channel choice – intensive, selective, exclusive

Channel choice will influence the type of consumers the product attracts, its perception in the market and its accessibility.

• Intensive –widely available and in as many outlets as possible (g. milk)
• Selective – available in limited number of outlets in a geographical area, using the most appropriate and best performing outlets.
• Exclusive – individual outlets are given exclusive distribution rights, usually used for expensive products or where specialist skills are required.

– Physical distribution issues – transport, warehousing, inventory

The activities involved in efficiently moving products from producer to consumer.

• Transport
  • Method chosen (rail, road, air, sea) will depend on type of good, cost, necessary speed of delivery and distance to be covered.
• Warehousing
  • Involves storing products in a secure manner, with ready access to they can be easily dispatched to retailers in smaller quantities when needed.
• Inventory
  • Inventory control ensures products are available for sale when needed so sales are not lost, without the issue of having too much stock and high storage costs.