disrubiton channels

Question 1

distribution channel

Answer 1

is the means by which a product is passed from the place of production to the customer or retailer

Question 2

distribution channel 1

Answer 2

producer to consumer

examples- car parts sold directly to the car producer

Question 3

advantages

Answer 3

it involves manufactures selling their products directly to their consumer
it is suitable for products like agricultural products which are sold straight from the farm
there is a lower price if its sold directly to the customer it cuts out wholesaler and retailer

Question 4

disadvantages

Answer 4

this is impractical for most products because the consumers probably do not live near the factories

it may be expensive to send the products by post and it wont be cost effective
it may not be suitable for products which cannot easily be sent by post

Question 5

distribution channel 2

Answer 5

producer to retailer to consumer

common where the retailer is large like a supermarket or when products are expensive like jewelry

Question 6

advantages

Answer 6

producer sells large quantities to wholesaler

reduced distribution costs compared to channel 1

Question 7

disadvantages

Answer 7

no direct contact with customers

Question 8

distribution channel 3

Answer 8

producer-wholesaler-retailer-consumer

using a wholesaler who performs the function of breaking bulk

Question 9

breaking bulk

Answer 9

this is where wholesalers buy products from manufactures in large quantities and then divide the stock to much smaller quantities for retailers to buy

Question 10

advantages

Answer 10

wholesaler saves storage space for small retailer and reduces storage costs

small retailers can purchase products in small quantities from wholesaler because they have a short shelf life

wholesaler may deliver to small retailer this saves on transport costs

Question 11

disadvantages

Answer 11

may be expensive for the small shop to buy from the wholesaler than if they bought straight from the manufacturer
wholesaler may not have the full range of products to sell
wholesaler may be a long way from the shops

Question 12

channel 4

Answer 12

producer to agent to wholesaler to retailer to consumer

Question 13

agent

Answer 13

is an independent person or business that is appointed to deal with the sales and distribution of a product or range of products they sell the products that are exported on behalf of the manufacturer

Question 14

advantages

Answer 14

manufacturer may not know the best way to sell their products in other markets

agents will be aware of local conditions and will be able to decide the best places in which to sell

Question 15

disadvantages

Answer 15

less control over the way the product is sold to consumers

Question 16

e-commerce

Answer 16

is the buying of goods and services using computer systems linked to the internet

Question 17

threats of e-commerce to a business

Answer 17

competition is very high if the business is selling products at a high price consumers can find an alternative

transports costs for delivery and packaging will be expensive
there is no face to face contact with consumers which can provide useful market research feedback

Question 18

threats to consumers

Answer 18

consumers need access to the internet to buy products some countries don’t have good internet

products cannot be see touched before being purchased and this can lead to returns of products

there is no face to face contact with sales staff so its difficult to find out more about a product

Question 19

opportunities to business

Answer 19

global coverage
low cost on promotion
access to many consumers
businesses can also easily make online purchases of supplies and materials from other businesses (b2b)