1.3.4 Distribution

Question 1

Definition of Distribution Channel

Answer 1

The various intermediaries a good will travel through from producer to consumer

Question 2

How does the 4 stage channel work

Answer 2

-Producer makes the product
-Producer sell product to wholesaler
-Wholesaler sells to retailers
-Retailers sells it to consumers
(Common for clothing, groceries, and electronics, such as Coca-Cola)

Question 3

How does the 3 stage channel work

Answer 3

-Producer makes the product
-Producer sell product to Retailer
-Retailers sells it to consumers
(Such as Toshiba selling laptops, high profit margin products)

Question 4

How does the 2 stage channel work

Answer 4

-Producer makes the product
-Producer sell product to Consumer
(Such as RyanAir selling plane tickets)

Question 5

How has E-Commerce affected Distribution

Answer 5

-Some businesses use drop shipping where products are sent from producer straight to consumer
-This can be seen through Amazon

Question 6

How has the shift from Product to Service affected Distribution

Answer 6

-Consumers have shifted from material possessions to value experiences
-This means services are directly delivering to consumers