RETAIL DISTRIBUTION CHANNEL
Have you ever wondered why there is a need for the retail distribution channel in the production process? The main purpose of distribution channels is to close the gap between the producer of a product and the end-user. Distribution also entails making a product available for purchase by dispersing it through different channels until it finally reaches the end-user. Where there is a need for distribution, definitely a distributor is needed. Who then is a distributor? A distributor is someone who purchases a product from the manufacturer, keeps or stores them, and then sells them through the distribution channel. The distribution channel consists of personnel, who are in between the producer and the consumer of a particular product. They are usually the agent, wholesaler, and retailer, the channel of distribution is also known as the most effective means to deliver a product to the consumer.
A retail distribution channel can then be defined as the pathway through which goods and services travel don to reach the consumer. As a manufacturer, who wants her product to thrive, you must know the people you are working with, you need to have an effective production process.
Here is what you need to know:
Agents/Brokers: they are intermediaries between the manufacture and the retailer, they sell to the retailer.
Retailer: they purchase goods from wholesalers or manufacturers and sell directly to the consumers.
Wholesaler: they purchase products in bulk and then sell to the retailers, sometimes they also sell to the consumers.
Besides knowing your channel distributors, you need to know how the channel works.
Manufacturer-consumer channel: this is when you or your company sells the product directly to the consumer.
Retail channel:this occurs when you as a manufacturer sell products directly to the retailer who in turn sell to the final consumer, this means that you are also playing the role of a wholesale.
Wholesale channel:the wholesaler purchases the good from the manufacturer in bulk and then sells to the retailer, who sell directly to the end-users.
Agent channel: the agents are not always needed but, in some cases, whereby the transportation of the products takes longer means, the agent will purchase the product and sell to the wholesaler who will then sell to the retailer who sells directly to the users of the product.
It is your primary duty as a manufacturer to choose the best channel that suits your product, although the retail channel is the most influential channel that influences the growth of your product, the decision is yours to make. However, before choosing a channel, you should consider the strength of your product whether it requires a long channel or not, you should also consider the type of customers you are dealing with, know what they need and how best they can get it.
Conclusively, the distribution channel is a driving wheel, it helps to sail the process of production to its destination safely.