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Place. Place – The distribution process. The process of moving the product from the producer to the consumer, and the channels used to do so. There are two main channels of distribution Direct Indirect And if we were to combine both channels then we call this multiple channel.

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Place the distribution process
Place – The distribution process

  • The process of moving the product from the producer to the consumer, and the channels used to do so.

  • There are two main channels of distribution

  • Direct

  • Indirect

    And if we were to combine both channels then we call this multiple channel


Direct channel
Direct Channel

This is the simplest channel, the producer is dealing directly with the consumer and there are no intermediaries


Indirect channel
Indirect Channel

This channel involves the use of one or more intermediaries from the manufacturer to the consumer


Multiple channel
Multiple channel

  • A business may use more than one channel of distribution, and distribute in different ways.

  • A business may sell directly to its customers through a factory outlet, but then also provide goods to a retailer to sell to the cusomer


Channel choice market coverage
Channel choice – market coverage

  • How a business chooses the channel of distribution best suited to its product depends largely on the location of the business’s market or market coverage.

  • The business can choose to do this in one of three ways, the difference being intensity,

  • Intensive distribution - when the business wants to saturate the market and sells through all available outlets, eg, milk, news papers

  • Selective distribution – moderate proportion of all outlets, eg. Clothes, electrical goods, chain stores

  • Exclusive distribution – the use of only one outlet for production on a large geographical area, eg. Exclusive products


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