MKT 421, Week 4, DQ 1:
What is a distribution channel? What is the relationship between channels of distribution and logistics? How does geographical location affect your selection of distribution channels? A channel of distribution is the means by which a product reaches the customer. It is "any series of firms (or individuals) that participate in the flow of products from producer to final user or consumer (Perreault 2009)." A distribution channel may be short, as in a company selling a product or service directly to the customer. In contrast, a distribution channel may be much longer, involving distributers and retailers. The channel of distribution is incorporated into the "place" aspect of the marketing mix. Logistics is defined as "the transporting, storing, and handling of goods in ways that match target customers’ needs with a firm’s marketing mix—both within individual firms and along a channel of distribution (Perreault 2009)." Logistics defines the manner in which a product travels along the channel of distribution. Both of these elements are closely related. Geographical location affects available channels of distribution. For example, you may not be able to buy a product from a small company locally if you reside a great distance from the manufacturing site. Smaller companies often do not have the means to distribute their products to retailers a great distance away. Therefore, your channel of distribution may be limited to buying direct from the company via phone or internet. Perreault, W. D., Cannon, J. P., & McCarthy, E. J. Jr. (2009). Basic marketing: A marketing strategy planning approach (17th ed.). New York, NY: McGraw Hill.
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