Distribution channels

The business entity, producing products, must form a certain marketing policy, the immediate task of which is to bring the goods to the end user. As a result of market research, the most optimal scheme of delivery of cargo to the buyer should be worked out. It includes numerous elements of transportation and storage, as well as product processing. The scheme for bringing the product to the final consumer must contain an element of service, carried out immediately after the sale of the goods.

The key question of marketing research is the choice of distribution channels. These schemes of product delivery to the buyer are different.

Distribution channels are those ways in which the goods move from the producer directly to the final consumer. Organizations or individuals involved in the movement of goods perform a number of functions. They are the following:

- distribution, collection of marketing information ;

- promotion of sales ;

- establishing contacts;

- adjustment of the product to customer requirements (packaging, assembly, sorting);

- negotiations;

- movement and storage of goods;

- financing the normal operation of the channel.

Any way of promotion is characterized by the presence of several threads:

- physical products;

- ownership of the goods;

- payments;

- information;

- movement of goods.

Distribution channels related to the service sector are characterized by the movement of intangible products (knowledge, ideas, etc.). Ways of moving goods are classified according to the number of their levels, each of which is any intermediary that brings the product closer to the final consumer.

Distribution channels are divided into three types. They include:

- straight lines;

- mixed;

- Indirect.

Direct channels of distribution of goods ensure the delivery of products from the direct producer to the consumer (the final one), bypassing the services of intermediaries. This method of implementation on the Internet has become widespread. This is determined by the fact that companies provide services (information, in the sphere of gambling, etc.), which are easy to implement with the participation of a computer.

Direct distribution channels are characterized by a number of features:

- a small volume of goods sold;

- close contact of the manufacturer and the consumer;

- flexible prices;

- Excellent knowledge of the goods sold;

- sustainable financial position of the producer;

- Wide possibilities of technical service of sold products;

- obtaining higher profits from sales;

- informative and quality feedback from customers.

Indirect channels of distribution of products provide for the initial movement of goods from the direct producer to the intermediary. And only then to the end user. This way of implementation is typical for firms that reduce sales costs, gain access to new markets, but at the same time they are reducing the direct contact with the buyer.

Typical features of indirect sales are:

- high volume of sales;

- low level of contact of the direct producer with the buyer;

- less flexible price policy;

- the lack of sufficient information about the quality of the goods;

- Weaker financial position of the producer;

- low opportunities for technical maintenance of goods;

- Receiving less profit from sales.

Distribution channels related to the mixed type combine the characteristic properties of indirect and direct marketing channels.