Distribution
A distribution business is the middleman between the manufacturer and retailer or (usually) in commercial or industrial the business customer. After a product is manufactured by a supplier/factory, it is typically stored in a distribution company's warehouse. The product is then sold to retailers or customers.
Distribution is one of the four aspects of marketing. The other three parts of the marketing mix are product management, pricing, and promotion.
Traditionally, distribution has been seen as dealing with logistics: how to get the product or service to the customer.
It must answer questions such as:
- What kind of distribution channel to use?
- Should the product be sold through a retailer?
- Should the product be distributed through wholesale?
- Should multi-level marketing channels be used?
- How long should the channel be (how many members)?
- Where should the product or service be available?
- When should the product or service be available?
- Should distribution be exclusive, selective or extensive?
- Who should control the channel (referred to as the channel captain)?
- Should channel relationships be informal or contractual?
- Should channel members share advertising (referred to as co-op ads)?
- Should electronic methods of distribution be used?
- Are there physical distribution and logistical issues to deal with?
- What will it cost to keep an inventory of products on store shelves and in channel warehouses (referred to as filling the pipeline)?
Author Credits ::
This article is licensed under the GNU Free Documentation License. It uses material from the Wikipedia article "Distribution (business)".