Question

Give Channel Design Decisions covering all four tasks for:

 FMCG

 Apparel

 Personal electronics.

 Speciality goods

Please take into consideration the Principles of marketing (Distribution Channel Strategy) to answer the very question.

Answer 1

Channel Design Decisions (CDD) are basically for establishing objectives for the channel, analyzing customer needs, and evaluating and identifying main channel alternatives.

FMCG needs an outstanding distribution channel i.e. intensive distribution because of the day to day basic requirement of the product. Customer needs food items on a daily basis and that is where they invest, therefore the distribution has to be solid. In terms of the channel's alternative, it could be done by a different channel of direct selling i.e. manufacturer to customer and no intermediary involved.

Apparel needs the distribution channel not only to hold the stock but to also for assortments of products i.e. selective distribution. The distribution channel understands the customer needs and increases the product movement from shops to customers. As the manufacturer's have expertise in making the product, direct selling becomes an alternative to the existing distribution channel.

Personal electronics need an excellent distribution channel i.e. selective distribution for effective marketing. They assist manufacturers in making the channel decisions and delivering the product safe and sound as per the customer needs. In this case, the alternative is used for profit-maximizing which determines the optimal channel structure, intensity of distribution and service.

Specialty goods require a more selective network i.e. exclusive distribution of retailers as the goods are for specific needs and special purposes. There are fewer customers who need these products due to the uniqueness of the products and services. In this, the intermediary and the levels of a distribution channel can be reduced for bringing the product closer to the ultimate buyer.