7.01Summarize the channels of distribution

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Title: 7.01Summarize the channels of distribution

1
7.01 Summarize the channels of distribution
2
What is distribution?

The moving of or transferring the ownership of
goods and services from the producer to the
consumer

3
What is a channel of distribution?

The path (channel) a product travels from the
producer (manufacturer) to the ultimate consumer
This is the place element in the marketing mix.

4
Who is an intermediary (middleman)?

Channel members who assist the producer in
getting the goods and services to the final user

5
Three types of intermediaries

6
Wholesalers

Companies that purchase large quantities from
manufacturers, store products in warehouses, and
sell them to other businesses.
For example, Ingles buys their soft drinks from
Pepsi and Coca Cola manufacturers. Bi Lo buys
their canned vegetables from Del Monte or Green
Giant manufacturers.

7
Retailers

Businesses that sell products to the final user
(consumer).
Brick-and-mortar retail A physical store that
sells their products directly to customers.
For example, Dillards, Lowes, and Ingles.
Non-store retail A way to reach customers
through vending machines, direct mail, catalog
retailing, TV home shopping, and e-tailing
(online retailing).
For example, Lance snack machines, Lands End
catalogs, and QVC.

8
Agents

An individual or business that connects the
buyers and sellers. Agents do not own the
products they sell.
For example, a real estate agent links the
homebuyer to the home seller.

9
What is a direct channel?

10
What is an indirect channel?

Distribution that occurs through one or more
intermediaries before reaching the final user
For example The apple farmer sells his apples to
Harris Teeter and Harris Teeter sells them to the
consumer

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