Marketing - Place - Distribution Channels

Question 1

Definition of Distribution Channels

Answer 1

The route/path taken by a product as it goes from producer to the final consumer

Question 2

What’s the benefit if a business has more distribution channels?

Answer 2

They have the ability to reach a wider potential market

Question 3

What is the distribution channel order ?

Answer 3

Manufacturer - agent - wholesaler - retailer - consumer

Question 4

What is a wholesaler ?

Answer 4

They buy products in bulk from manufacturers and break into small quantities for retailers

Question 5

What is the choice of distribution channel decided by ?

Answer 5

•Cost
•Type of Product
•Market Coverage
•Contol

Question 6

What is the traditional approach ?

Answer 6

wholesalers buying in bulk, reducing the need for producers to make small deliveries to retailers and providing a fast supply service to retailers who don’t have the facilities to hold large stocks

Question 7

What is the modern approach ?
(distribution channel)

Answer 7

large retailers having regional warehouse systems and the size to buy in bulk directly from producers. Producers also sell directly to consumers using mail orders, telephone sales and the internet

Question 8

Forms of retailing

Answer 8

•Department Stores (John Lewis)
•Supermarkets (Tesco)
•Out-of-town speciality stores (IKEA)
•Town centre speciality stores (Clark’s)
•Convenience Stores (One-Stop)
•Showrooms (DFS)

Question 9

What are agents ?

Answer 9

-They do not take ownership of the goods.
-They aren’t employed by the business but represent it and try to gain sales.
-Often used to enter overseas markets

Question 10

Examples of Agents

Answer 10

-travel agents
-ticket agents
-agents for football and actors

Question 11

Why would you use agents when operating abroad?

Answer 11

• To negotiate sales on behalf of a seller
• A link between those providing a good or service and those wishing to buy them