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4.2 Marketing – PLACE . IB BUSINESS & MANAGEMENT A COURSE COMPANION P219-220. DISTRIBUTION CHANNELS. Distributional channels are the ways in which a business ensures that customers can gain access to its products.
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4.2 Marketing – PLACE IB BUSINESS & MANAGEMENT A COURSE COMPANION P219-220
DISTRIBUTION CHANNELS • Distributional channels are the ways in which a business ensures that customers can gain access to its products. • This is either done by directly selling to consumers or by using intermediaries
DISTRIBUTION CHANNELSDirect Selling • Direct selling is when the producer of goods or services deals directly with the customer. • Historically, suppliers may have found it hard to access the general public, but the growth of the Internet has meant that even small local suppliers can access customers worldwide. • The reduction in transport costs also means that businesses around the world can be competitive almost anywhere as goods can be quickly and cheaply shipped to customers.
DISTRIBUTION CHANNELSIntermediaries • Traditionally, suppliers have tended to use an intermediary. • This may have been supplying a retailer (eg: Heinz supplying supermarkets with ketchup or alternatively supplying a wholesaler, who then distributes the products onto smaller retailers) • Agents may also exist, particularly in service industries such as travel, insurance or mortgage advice who actively look for business.
Advantages & Disadvantages of Different Distribution Channels