Question

What is a distribution channel?

How does geogrpahical location, the size and shape of the product, where it is manufactured and how many are sold in a year affect your selection of a distrubution channel?

Answer 1

Distribution channel is the sequential medium of chain of channel partners or businesses through which the goods or services passes until it is delivered to the final consumer or customer.

Below factors affect the selection of distribution channel:

Geographical Location: Distance from manufacturing location & distance to the customer determines the logistics cost, mode of transportation. Mode of transportation also decided due to it

Size & Shape of the product: It determines what type of vehicle or medium is used for transportation (e.g., bulk shipment of crude or in container). Storage in warehouse will depend on shape & size of product.

Where it is manufactured: Distance from the place of manufacture to place of delivery or consumption is very important.  

How many are sold in a year:   It determines the size of warehouse needed for storage of product.