Distribution (Place) decisions
- Place defines both the physical location where a product is available as well as the
distribution channel it has travelled through to get from the manufacturer to the customer
- Place can be a physical market where byers and seller meet face to face or a virtual location
e.g. over the internet
- Increasingly firms are adopting a multi channel approach to place
Distribution
- Place is the term given to distribution
- Distribution is the process of getting the firm’s product to the market
- Distribution channels are the routes to market that a product takes from producers to the
final customer
- There are a number of distribution channels available to firms:
- Short distribution channels are where the producer sells either directly to the customer or
through a retailer
- Long distribution channels are where there are more than one intermediary (middle
person) between the producer and the customer
Types of distribution Channels
- Producers can use direct selling where they sell directly to the final customers
- Often producers use retailers who sell products on to the general public
- Wholesalers buy large quantities of supplies from producers and sell them on in smaller
quantities. E.G a corner shop might go to a wholesaler to buy their products
- Increasingly, firms are using e-commerce benefiting from the power of the internet to sell
on their products
- Multi-channel distribution is when a firm chooses to use a combination of methods
Traditional (long) Modern (medium length) Direct (short)
1. Manufacturer 1. Manufacturer 1. Manufacturer
2. Wholesaler
3. Retailer 2. Retailer
4. Consumer 3. Consumer 2. Consumer
Manufacturer/Producer – Organisation that take raw material or components and process them
into finished or semi processed goods.
- Operate in the secondary sector of the economy such as housing or car production
Wholesalers – Buy large quantities of supplies from producers and sell them on in smaller quantities
- They act as an intermediary between manufacturers and retailers and consumers
Retailer – An organisation that sells good or services to the general public or end user
- Reatailers are at the end of the channel of distribution
- They can act as an intermediary between producers, wholesalers and the consumer
- Place defines both the physical location where a product is available as well as the
distribution channel it has travelled through to get from the manufacturer to the customer
- Place can be a physical market where byers and seller meet face to face or a virtual location
e.g. over the internet
- Increasingly firms are adopting a multi channel approach to place
Distribution
- Place is the term given to distribution
- Distribution is the process of getting the firm’s product to the market
- Distribution channels are the routes to market that a product takes from producers to the
final customer
- There are a number of distribution channels available to firms:
- Short distribution channels are where the producer sells either directly to the customer or
through a retailer
- Long distribution channels are where there are more than one intermediary (middle
person) between the producer and the customer
Types of distribution Channels
- Producers can use direct selling where they sell directly to the final customers
- Often producers use retailers who sell products on to the general public
- Wholesalers buy large quantities of supplies from producers and sell them on in smaller
quantities. E.G a corner shop might go to a wholesaler to buy their products
- Increasingly, firms are using e-commerce benefiting from the power of the internet to sell
on their products
- Multi-channel distribution is when a firm chooses to use a combination of methods
Traditional (long) Modern (medium length) Direct (short)
1. Manufacturer 1. Manufacturer 1. Manufacturer
2. Wholesaler
3. Retailer 2. Retailer
4. Consumer 3. Consumer 2. Consumer
Manufacturer/Producer – Organisation that take raw material or components and process them
into finished or semi processed goods.
- Operate in the secondary sector of the economy such as housing or car production
Wholesalers – Buy large quantities of supplies from producers and sell them on in smaller quantities
- They act as an intermediary between manufacturers and retailers and consumers
Retailer – An organisation that sells good or services to the general public or end user
- Reatailers are at the end of the channel of distribution
- They can act as an intermediary between producers, wholesalers and the consumer
