1.3.4 Distribution

Question 1

What is a 4-way distribution channel & when is it commonly used for?

Answer 1

4 stages:
Producer, Wholesaler, Retailer,Consumer

Channel is commonly used for products such as groceries, clothing & electronics

Question 2

What is the 3 stage distribution channel & when is it commonly used for?

Answer 2

Eliminates the wholesaler stage:
Producer, Retailer,Consumer

This channel is often used for products with high demand or where the cost of distribution is high

& Often used for products with high profit margins, where the manufacturer can afford to sell directly to the retailer and still make a profit

Question 3

What is the 2 stage distribution channel & what is it commonly used for?

Answer 3

• Eliminates both wholesaler & retailer stages
  Manufacturer selling directly to the end consumer
• Commonly used for products that are sold online or through direct sales channels

Question 4

What changes in distribution are there to reflect social trends?

Answer 4

• Online distribution
• The shift from product based businesses to service based business

Question 5

What is online distrubution & why has it become increasingly popular?

Answer 5

• Has become increasingly popular due to the convenience & accessibility it offers to consumers
• Many businesses now use drop-shipping which allows them to sell products without holding stock
• Once business has sold products they are shipped from the producer to the customer
• This reduces cost & complexity of distribution making it easier for businesses to sell online

Question 6

What is the explanation for the Shift from Product-based Businesses to Service-based Businesses

Answer 6

• Consumers increasingly value experiences over material possessions & this shift has impacted distribution, as delivery of services is often quite different from delivery of physical products
• Distribution for service-based businesses may involve delivering services to customers directly
• This requires a different set of distribution capabilities than traditional product-based distribution