Channels of Distribution
Channels of Distribution
Channels of Distribution
Distribution channel refers to the means that an organization uses to ensure its products and services reach its customers. The distribution channel consists of an independent set of organizations that provide products and services for use and sale. Even to the most successful organizations managing distribution channels might be very difficult, especially in technology and social media platforms, where one has to think of many variables. Failure to develop an effective strategy on how to manage distribution channels leads to an increase in costs (Hynninen, 2017).
Most organizations believe that increasing the number of channels will lead to higher profits. This is because having various distribution channels means that more products and services will reach customers, translating to a lot of money. We can use some ways to manage distribution channels include; carefully selecting channel mediators- an organization can manage its distribution channels by increasing the number of its channels to have higher benefits. Mediators’ companies take companies products and sell them to the open market. Another way is by consolidating all other media into a strong one- another way of managing distribution channels is by bringing together all other channels into one more strong Channel. Channels of Distribution
After reviewing this week’s resources, the following are the various channels of distribution; direct channel-it’s the oldest Channel. Customers and manufacturers of goods and services get into direct contact without mediators. Secondly, indirect Channel- this is where the end products of the companies reach customers through an intermediary. Another channel is dual distribution- when a company uses multiple channels to reach their customers. Internet channels- manufacturers use the internet to sell their products to their consumers (Li,2019).
The following are the two better ways to manage distribution channels for nice and lovely jelly that I use. Firstly, special introductory offers- this gives free offers to the first consumers of the friendly and pleasant jelly to motivate them to come back to buy the product again and again. I will emphasize to the customers that the offer won’t be found forever. The second better way is by running a contest on social platforms- since most people today can access social media, it will be the fastest way to reach to many customers as possible. Through social media, I will advertise my product and show how effective it is when people use it.
Li, M. (2019). Overconfident distribution channels. Production and Operations Management, 28(6), 1347-1365.
Hynninen, E. (2017). Supply chains and global distribution channels for particle filters.
Distribution channel is nothing but different processes or methods that used to take the product to customers. The product distribution is one of the important steps but often not of company’s ignore it. Companies will always look for cheapest way to send the product to the customers, but they will ignore whether the people are comfortable with the procedure are not. Some companies use direct channels some companies use the indirect channel to take their products to the customer. Choosing right or suitable channel is always challenging but selecting efficient will bring lot of profits to the company. Managing distribution channels is challenging even for the well proved companies in this advanced technology world. Some companies use multiple distribution channels to sell their products, but the question is does this benefits the company.it may be true in some cases it may be false in some cases. Because when we use multiple distribution channels, we may need more resources to manage it. So, the company might need to invest more money and time in this kind of strategy. But it is beneficial when we earn more profits than the investment. So, the company need to calculate and analyze all these efforts before increasing their number of distribution channels (Tarver, 2020).
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In my day-to-day life I use lot of products from LUSH. LUSH is a British cosmetic retailer which sells only cosmetics made with vegetarian products ,85% of them are only Vegan (Wikipedia contributors, 2021). Lush products have very pleasant smell and the freshness. At present this company sells their products in 49 countries. LUSH products are sold only in the LUSH store across the world. Which means only through the direct channel. In addition to this they have their own website and mobile app to sell their products but some of the products will be available to buy online for example fresh face packs. The way the products are designed are tough to sell in the retail shops or through third party vendors to keep the products easily available for the customers. So, lush uses their direct distribution channel to protect quality of the products LUSH attracts customers by providing good products and service it will not do any traditional marketing. If we look at the LUSH store locations most of them are located in shopping malls which is quite hard for the customers to go to the mall only to pick up the products. If they have the stores outside the mall, it is very easy and quick for the customers to pick up the products.
Tarver, E. (2020). How Can You Make a Distribution Channel More Efficient? Investopedia. https://www.investopedia.com/ask/answers/071315/what-are-some-ways-make-distribution-channel-more-efficient.asp
Wikipedia contributors. (2021c, July 19). Lush (company). Wikipedia. https://en.wikipedia.org/wiki/Lush_(company)