Place or DistributionDistribution (or "Place") is the fourth traditional element of the marketing mix. The other three are Product, Price and Promotion.The Nature of Distribution ChannelsMost businesses use third parties or intermediaries to bring their products to market. They try to forge a "distribution channel" which can be defined as"all the organizations through which a product must pass between its point of production and consumption"Why does a business give the job of selling its products to intermediaries? After all, using intermediaries means giving up some control over how products are sold and who they are sold to.The answer lies in efficiency of distribution costs. Intermediaries are specialists in selling. They have the contacts, experience and scale of operation which means that greater sales can be achieved than if the producing business tried run a sales operation itself. ( tutor2u.net)Two important aspects of Distribution decision1) Physical transportation of products : from the place of production to the hands of the customer, goods have to be physically transported. The decision of using the appropriate medium of transportation is crucial. Among many factors that influences the decision of transportation mode chosen are nature of the goods, cost or budget of the company etc. For example if you are in the bakery business you will definitely choose to deliver your items faster compared to a business of item such as soap or non-perishable items.2) Another important decision is regarding the channel intermediaries (also know as the middle-man). A business may decide to use direct distribution ( company to client) as is the case in most b2b transaction. OR the business may choose to use the services of intermediaries such as whole seller, retailer , agents or brokers.Please know the difference between whole seller, retailer, agents and broker.Important reading CHANNEL DESIGN DECISION (Page 348-352)

Deciding on the distribution intensityYou have 3 option regarding the intensity of distribution. The intensity will depend on the nature of the product, your marketing and organizations growth strategy etc.a) Intensive distribution: stocking the product in as many outlet as possible. For example : coca cola , Pepsi, grameen phone cards, and other convenience productb) Exclusive distribution: giving a limited number of dealers the exclusive right to distribute the companys products in their territories. c) Selective distribution: the use of more than one but fewer than all of the intermediaries who are willing to carry the companys products.