1.3.4 Distribution

Question 1

distribution

Answer 1

products -> right place for customers = purchase
include physical/online
availability and visibility

Question 2

distribution channel

Answer 2

route taken by product as it moves from producer to customer/consumer

Question 3

wholesaler

Answer 3

large quantities

sell smaller quantities (intermediary manufacturers and retailers and consumers)

Question 4

customer

Answer 4

end user of product/service at end of distribution channel

Question 5

retailer

Answer 5

organisation that sells goods and services to the general public/end user

Question 6

producer

Answer 6

take raw materials or components

process them into finished or semi processed goods

Question 7

distribution channels

Answer 7

1. direct
2. modern
3. traditional
4. use of agent
   (5. be own retailer e.g. apple)

Question 8

agent

Answer 8

facilitates sale between a business and a wholesaler, foreign markets,
commission based upon successful sales,
specialist mkt knowledge

Question 9

direct distribution

3positives and 3negatives

Answer 9

manufacturer > consumer (straight to)

• direct marketing
  e. g. amazon/solicitor

positives:
1-quicker, 2max rev, 3cheaper for customer

negatives:
1-options, 2no outlets, 3internal work

Question 10

modern distribution

2 positive 1 negative

Answer 10

manufacturer > retailer > consumer
-electronic goods & mass market
all round country = sales vol = higher

positives:
- convenient, control supply/mkting

negatives:
- time consuming (manage relationships)

Question 11

traditional distribution

2 positives 1 negative

Answer 11

manufacturer>wholesaler>retailer>consumer

• manufacturers = few wholesalers & sell larger quantities or wholesaler and many retailers
• wholesaler = offer trade credit terms

positives:
- focus on production & save costs (storage)

negatives:
- wholesaler = marketing different & % profits

Question 12

agent distribution

1 positive 1 negative

Answer 12

manufacturer>agent>wholesaler>retailer>consumer
sell in another country
language/ regulations/ importing and tax

positives:
- selling in another country simple mkt knowledge

negatives:
- supply chain longer = increase final price

Question 13

intermediaries

Answer 13

people in middle e.g wholesaler (middle man)

-cutting them out reduces costs, complexity, stages of distribution

Question 14

short distribution channels

Answer 14

producer sells

directly -> customer or though a retailer

Question 15

long distribution channels

Answer 15

where there are more than 1 intermediary (middle person) between producer and customer

Question 16

9 factors influencing choice of channel

Answer 16

1-channel length 
2-intermediary? 
3-control over 
4-product (luxury wholesalers )
5-TM
6-size of business (through wholesalers = sales)
7-personalisation
8-infrastructure(set up/run e-commerce)
9-growth (demand =more channels)

Question 17

methods of distribution

Answer 17

1. traditional physical channel
2. direct to retailer
3. owning your distribution
4. online selling
5. multi channel distribution

Question 18

traditional physical channel

small producers…

Answer 18

• small producer = hard to achieve big chain distribution sell to wholesalers
• distribution = sale to independent shops
• cant afford distribute to lots of small shops

Question 19

direct to retailer distribution

Answer 19

• large producers & cost effective (wholesaler)

- tough negotiations & credit terms

Question 20

owning your distribution

Answer 20

-apple,

closer to market=control factors e.g. price&location

Question 21

online selling distribution

Answer 21

• direct online -> customer, producer = 100% profit
• online retail = small firms often struggle to build won successful e-commerce sales platform = piggy back of established e.g eBay business runs of their website

Question 22

multi channel distribution

3positives 3negatives

Answer 22

-more than 1 type of distribution channel

positives:
- more TM
- meet cust expectations (more than 1 channel)
- higher rev e.g if retailer outlets = no stock - buy online

negatives:
- conflict = compete with retailers
- complex to manage
- pricing strategy = confused to customer

Question 23

changes in distribution to reflect social trends

Answer 23

1. online distribution
2. changing from product -> service

• mobile device
• ageing pop = disposable income
• mass customisation = reduce stock holding
• e-commerce = reduce high street retailers

Question 24

online distribution change

4 benefits

Answer 24

-distribution of almost any product is internet,

-benefit of internet:
1-niche = wider audience
2-low BTE, set up costs small
3-greater geographically dispersed market
4-transactions happen solely online e.g. tickets

Question 25

changing from product to service distribution change

Answer 25

• changing from physical tangible products a service

- dont have to own something to be able to use it e.g. music/song (CD)

Question 26

barrier to entry

Answer 26

factors making it hard for new firms to break into an existing market

Question 27

e-commerce

Answer 27

electronic commerce-carried out online

Question 28

m-commerce

Answer 28

selling via mobile phones and tablets

Question 29

impulse purchasing

Answer 29

buying in an unplanned way

Question 30

long tail

Answer 30

huge number of tiny businesses appealing to minority tastes
find a profitable existence online
target whole planet not just local area

Question 31

pure play

Answer 31

only sell online