P2 UNIT 29
Distribution channels in retail
My 5 businesses-
Multiple chains: Tesco, MacDonald's, urban outfitters
Retailer: corner shops
My choice: Dreamers apparel
What are the different channels?
Channel 1 is when producers sell their products to wholesalers, which are then bought off from
retailers so they can sell it to the consumers. An example of this would be for clothes shops as
producers would make them in other countries which would then be sold to the suppliers so
that clothing retailers can pick out what clothes they want to resell to their customers.
Channel 2 is when retailers buy products in bulk straight from the producers so they can buy it
at a cheaper price and make more profit when reselling it. An example of this could be when a
supermarket purchases their ready made meals, as they would buy them from wholesalers in
bulk.
Channel 3 is when the products, such as food is sold directly to the consumers from the
producers. An example could be when fast food restaurant makes their food to order.
How my chosen businesses use the different distribution channels
Tesco use all three channels in different ways. They would use channel 2 for their more popular
products and would use channel 3 for products such as clothing and they would use channel 1
for the bakery section.
Macdonald's uses channel 3 because they fry their food instore as you order. They would also
use channel 2 when purchasing toys for their happy meals.
Urban outfitters uses channel 1 because they buy their clothes and shoes from suppliers and
then sell them to their customers.
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Distribution channels in retail
My 5 businesses-
Multiple chains: Tesco, MacDonald's, urban outfitters
Retailer: corner shops
My choice: Dreamers apparel
What are the different channels?
Channel 1 is when producers sell their products to wholesalers, which are then bought off from
retailers so they can sell it to the consumers. An example of this would be for clothes shops as
producers would make them in other countries which would then be sold to the suppliers so
that clothing retailers can pick out what clothes they want to resell to their customers.
Channel 2 is when retailers buy products in bulk straight from the producers so they can buy it
at a cheaper price and make more profit when reselling it. An example of this could be when a
supermarket purchases their ready made meals, as they would buy them from wholesalers in
bulk.
Channel 3 is when the products, such as food is sold directly to the consumers from the
producers. An example could be when fast food restaurant makes their food to order.
How my chosen businesses use the different distribution channels
Tesco use all three channels in different ways. They would use channel 2 for their more popular
products and would use channel 3 for products such as clothing and they would use channel 1
for the bakery section.
Macdonald's uses channel 3 because they fry their food instore as you order. They would also
use channel 2 when purchasing toys for their happy meals.
Urban outfitters uses channel 1 because they buy their clothes and shoes from suppliers and
then sell them to their customers.
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