Selection should include consideration of the following potential distribution methods:
- Direct channel (i.e., the producer sells directly to the consumer)
- Indirect channel (i.e., the producer sells to an intermediary, such as a retailer or wholesaler)
- Internet (may be direct or indirect).
Selection among distribution methods should include
- personnel requirements of each method
- cost requirements of each method
- convenience of each method to the customer
- legal and licensing requirements.
Process/Skill Questions
- What are the primary methods of retail distribution? What are some examples of each?
- How does a business determine the most advantageous method(s) of distribution?
- Why would a business select to use direct channel? Indirect channel?
- What problems can occur if product distribution breaks down?
- How does a specific product move through the distribution channel, from production to consumer?
- How does the distribution channel affect price?