Distribution Channel

A distribution channel (or just “channel“) is one or more companies or individuals who participate in the flow of goods and services from the manufacturer to the final user or consumer. Channels can be very simple, like when a farmer sells produce directly to a grocery store, or they can be very complex, like when products are sold through a number of intermediaries before reaching the end customer.

There are a few key things to keep in mind when looking at distribution channels:

  1. There is no one perfect channel for every product.
  2. Channel design is a balancing act between reach and efficiency.
  3. The chosen channels will vary depending on the product and market.
  4. Channel members have different levels of power and discretion.

In the context of logistics and supply chain management, distribution channels are important because they determine how goods and products move from producers to consumers. A well-designed distribution channel can help a company reach more customers more efficiently, while a poorly designed channel can lead to lost sales and higher costs.

It’s therefore important for companies to carefully consider their distribution channels and make sure they are appropriate for their products and target markets.

Related Links

Understanding of Distributions and Logistics Channels – T1 2016 MPK732 Marketing Management (Cluster B)
Distribution: Channels and Logistics
The role of logistics in the distribution channel – SCM Concept
Channels of distribution and logistics

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