1.3.4 Distrubtion

Question 1

What is distribution?

Answer 1

The movement of goods and services from the producer to the final customer

Question 2

What is direct distribution?

Answer 2

Where the business sells directly to the consumer

Question 3

Benefits of direct distribution

Answer 3

1. More control over price

2. Able to set price that maximises objectives

Question 4

Drawbacks of direct distribution

Answer 4

1. Possible lack of exposure without successful intermediary

2. Customers may choose competitors with better brand image

Question 5

What is direct to retailer distribution?

Answer 5

Where the business sells the product to a retailer who then sell it on

Question 6

Benefits of direct to retailer distribution?

Answer 6

1. Increased exposure from association with retailers brand image
2. Improved reputation
3. Increased sales and retention

Question 7

Drawbacks of direct to retailer distribution?

Answer 7

1. Lose of control in distribution
2. retailers may set prices that don’t reflect the businesses objectives
3. Customers may perceive the business differently

Question 8

Internet distribution

Answer 8

This where a firm sells their good over the internet

Usually includes

Question 9

Benefits of internet distribution

Answer 9

1. Less costs

2. Global market instead of just local

Question 10

Drawbacks of internet distributions

Answer 10

1.No relationship with consumers
2.May not reach all age demographics
3.

Question 11

What is a wholesaler?

Answer 11

They buy products in bulk

Then sell them in small bunches

Question 12

Benefits of a wholesaler to the business

Answer 12

The business can get their products nationwide

Reduces handling time

Question 13

Drawbacks of wholesalers to the business

Answer 13

1. Products of competitors will next to the firms
2. Reduced profit margin due to wholesaler buying in bulk
3. Loss profit by not selling direct to the consumer