Question

To distribute your product or service, you have a choice of either Direct Channel distribution or Indirect Channel distribution. There are factors that would influence your decision. Name the factors that would influence your decision to choose Direct Channel distribution.

Answer 1

DIRECT AND INDIRECT CHANNEL:

There are two types of distribution channels: direct and indirect. As the names would imply, direct distribution is a direct sale between the manufacturer and the consumer, and indirect distribution is when a manufacturer utilizes a wholesaler or retailer to sell their products.

DIFFRENCE BETWEEN DRIRECT AND INDIRECT DISTRIBUTION:

Direct distribution involves only the producer selling to directly to the consumer, while indirect distribution involves one or more intermediaries before it reaches the consumers' hands.

FACTORS THAT INFLUENCE TO CHOOSE DIRECT OR INDIRECT CHANNEL FOR DISTRIBUTION:

Market Related Factors:

​​​​​​Since the channels of distribution operate in the market. The market related factors are very important.

• Customers
• Competition

2. Product Factors:

Since it is the product which is to be distributed, the product characteristics also have to be analyzed while choosing a channel of distribution. Different products are different in nature and this nature of the products requires different types of channels.

• Perishability
• Nature of the product