Place - Where the Product is Sold

Question 1

What is meant by place?

Answer 1

How products get from manufacturers to consumers

Question 2

Name the 3 indirect Distribution Channels

Answer 2

• 1) Manufacturer to Wholesaler to consumer
• 2) Manufacturer to Wholesaler to Retailer to Consumer
• 3)Manufacturer to Retailer to Consumer

Question 3

Explain - 1) Manufacturer to Wholesaler to consumer

Answer 3

Consumer buy from a Cash & Carry warehouse

• Good for Manufacturer as:
  
  • Wholesaler buys in bulk
  • Wholesaler takes on cost of storing products
  • Wholesaler takes the risk of not selling them
• For consumer:
  
  • Good as pays lower price than at retail
  • Levels of customer service may be lower

Question 4

Explain - 2) Manufacturer to Wholesaler to Retailer to Consumer

Answer 4

Traditional route:
Commonly used in food & drink industry
- Good for manufacturer - same as channel 1
- Good for Retailer:
- The wholesaler reduces the risk by letting the retailer buy in smaller quantities.
- Gives them a wide choice of goods
Problem is it can take a long time to get from manufacturer to consumer

Question 5

Explain - 3) Manufacturer to Retailer to Consumer

Answer 5

Becoming more common:
Commonly used in clothing industry.
- Faster than dealing with retailers through wholesaler
- Manufacturer gets better consumer feedback about products
- But harder for small retailers to avoid having to hold stock

Question 6

Explain the one direct channel?

Answer 6

Manufacturer to Consumer:
Now very popular
EG Factory shops, mail order, telesales & internet
- Fastest channel
- Cheapest for consumer
- Can be more difficult for consumer to shop around as Manu only sell their own prod, retailers sell a range of manufacturers products
- Customer service levels may not be as good