PREPARED BY :JATIN BANSAL

AKSHAYAMANPREET KAUR

ISHA GUPTANAVREET KAUR

CHANNEL OF DISTRIBUTION

The path through which goods and services travel from the vendor to the consumer or payments for those products travel from the consumer to the vendor

CHANNEL OF DISTRIBUTION MEANING:

Middlemen are the one who supplier of raw materials, labor. Distribution channels-retail, wholesaler, agents/brokers. To make things available from the place of production to the place of consumption.

DISTRIBUTION OBJECTIVES

Setting distribution objectives requires knowledge of which,

if any, existing objectives & strategies may impinge

on these distribution objectives.

InformationPromotionContactMatchingNegotiationPhysical DistributionFinancingRisk taking

FUNCTIONS OF CHANNEL

PHYSICAL DISTRIBUTION - NATURE AND IMPORTANCE

- Physical distribution: Moving tangible products through distribution channels

- Physical distribution (or logistics) consists of all activities involved in moving the right amount of the right products to the right place at the right time

- IN THE PAST YEARS, THE SURGE OF E-COMMERCE HAS UNDERSCORED THE IMPORTANCE OF PHYSICAL DISTRIBUTION THE CHALLENGE RELATES TO FULFILLMENT, WHICH ENTAILS

HAVING THE MERCHANDISE THAT IS ORDERED BY A CUSTOMER IN STOCK AND THEN PACKING AND SHIPPING IT IN AN EFFICIENT, TIMELY MANNER

DIRECT MARKETING CHANNEL OR ZERO LEVEL CHANNELS:

PRODUCER CUSTOMER

ONE LEVEL CHANNEL:

PRODUCER CONSUMER

RETAILER

DISTRIBUTORS

TWO LEVEL CHANNEL:

PRODUCER WHOLESALER

CONSUMER RETAILER

DISTRIBUTOR

THREE LEVEL DISTRIBUTION:

PRODUCER DISTRIBUTOR WHOLESALER

RETAILERCONSUMER

FOUR LEVEL DISTRIBUTION:

PRODUCER AGENT DISTRIBUTOR

CONSUMER RETAILER WHOLESALER

WHO ENGAGES IN CHANNEL DESIGN?

• Producers, manufacturers, serviceproviders, franchisors

• Look down the channel

toward the market

• Look up the channel

to secure suppliers

• Look both up and down

the channel

Firms WholesalersRetailers

CHANNEL DESIGN PARADIGM

1. Recognize the need forchannel design decision

7. Selectchannel members

5. Evaluaterelevant variables

6. Choose the “best”channel structure

2. Set & coordinatedistribution objectives

3. Specifydistribution tasks

4. Develop alternative channel structures

VARIABLES AFFECTING CHANNEL STRUCTURE

1. Market Variables2. Product Variables3. Company Variables4. Intermediary Variables5. Environmental Variables6. Behavioral Variables

Categories of Variables