Distribution of Goods and Services Strategy

Distribution: Broadly speaking, the distribution can be defined as marketing activities that seek to facilitate and simplify the delivery of goods and services from producers to consumers, allowing their use in accordance with the required (type, quantity, price, place, and when needed).

In the execution of distribution activities, companies often have to work with a variety of intermediary (middleman) and channels of distribution (distribution channel) to offer their products to market.

Intermediary: The definition of an intermediary is a person or company that connects the flow of goods from producer to final consumer and industrial consumers.

In general, intermediaries are divided over the merchant middleman wholesaler and retailer of (dealer), and agent middleman.

Intermediary is required mainly because some of the gap between producers and consumers. These include geographical disparities gap, time gap, gap quantity, assortment gap, communication and information gap.

To overcome these problems marketers need an intermediary to make the adjustments, which include accumulating, bulk-breaking, sorting, and assorting.

The purpose of the use of intermediaries is to utilize the contacts or relationships, experience, specialization, and scale their operations in the distribution of products so as to reach the target market effectively and efficiently.

Distribution channels (marketing channel, trade channel, distribution channel) is a route or a series of intermediaries, either managed or independent marketers, in delivering the goods from producers to consumers.

Here are the levels in the distribution channel based on the number of intermediaries in it, namely

Zero-level channel shows that marketers are not using intermediaries in marketing their products (also called direct-marketing channel).

One-level marketers using the channel shows one type of intermediary.

Two-level means that use of two types of channel intermediaries, and so on.

Criterion 3 C: Basically when choosing distribution channels, enterprises should follow the criteria of 3C, the control channel, market coverage, and cost.