Distribution Flashcards
1
Q
What is a distribution channel?
A
- route a product takes from producer to consumer
2
Q
What is the aim of distribution?
A
to make products available in the right place at the right time in the right quantities
3
Q
What will a distribution channel with more than one stage have?
A
intermediaries
4
Q
What is the purpose of distribution channels?
A
- provide a link between production and consumption
- help gather market info
- communicate promotional offers
5
Q
What are the four main types of distribution intermediary?
A
- retailers
- wholesalers
- distributors
- agents
6
Q
What is a retailer?
A
- final step in chain, deals with customer
- focused on consumer markets
7
Q
Advantages of using retailers/
A
- conveinience to customers
- have a broad geographical coverage
- retailer chooses final price
- retailer holds stock
8
Q
Describe wholesalers?
A
- buy in large quantities from producers and sell in smaller quantities to retailers
- makes money by buying at a lower price from producer and adding profit margin when selling to retailer
9
Q
Key points about distributors?
A
- distribute products and serve as a local sales point
- offer products from many producers
10
Q
key points about agents?
A
- type of distributor
- doesnt hold stock
- usually works in tertiary sector
- earn commision based on sales received
11
Q
What are the decisions when choosing which distribution channel?
A
- channel length, direct or indirect ?
- choice of intermediary
- use just one or several channels
12
Q
Two types of distribution?
A
- direct and indirect
13
Q
What is direct distribution?
A
- where a producer and consumer deal directly with each other without the involvement of an intermediary
14
Q
What is indirect distribution?
A
- involves the use of intermediaries between producer and consumer
15
Q
advantages of indirect distribution?
A
- geography, some customers may live too far away to be reached
- enables small orders to be put in large ones
- business may lack retailing experiance
