1.3.4 Distribution

• What are distribution channels defined as?

  Paths from producer to consumer
• Direct Distribution involves selling directly to the consumer
• Selecting a distribution channel is a critical business decision
• What is supply chain management concerned with?

  Movement of goods
• Intermediaries play a key role in indirect distribution
• Steps in a direct distribution channel

  1️⃣ Producer manufactures goods

  2️⃣ Producer sells directly to consumers
• Match the type of distribution channel with its description:

  Direct ↔️ Producer → Consumer

  Indirect ↔️ Producer → Retailer → Consumer
• Distribution channels can only be direct

  False
• What is the path in a distribution channel that involves a wholesaler, retailer, and consumer?

  Indirect
• Apple uses both direct and indirect distribution
• Direct distribution involves intermediaries

  False
• What is the primary advantage of direct distribution?

  Higher profits
• Indirect Distribution uses intermediaries such as wholesalers and retailers
• Indirect distribution results in higher profit margins for producers

  False
• What is an example of a company that uses direct distribution?

  Tesla
• What are the two main types of distribution channels?

  Direct and indirect
• In a direct distribution channel, the producer sells directly to the consumers
• Direct distribution channels involve intermediaries such as retailers and wholesalers.

  False
• Match the intermediary with its role:

  Wholesalers ↔️ Buy in bulk and distribute to retailers

  Retailers ↔️ Sell directly to consumers
• What is a key advantage of indirect distribution in terms of market coverage?

  Wider reach
• Distribution intensity refers to the level of market coverage a company aims to achieve through its channels
• Steps involved in supply chain management (SCM)

  1️⃣ Planning

  2️⃣ Sourcing

  3️⃣ Manufacturing

  4️⃣ Delivery

  5️⃣ Returns
• Direct distribution channels always lead to higher profit margins due to lower costs.
• Distribution channels are the paths goods or services take from producers to consumers
• Distribution channels are the paths through which goods or services move from producers to consumers.
• What are the two main types of distribution channels?

  Direct and indirect
• In a direct distribution channel, the producer sells directly to consumers without intermediaries.
• In an indirect distribution channel, intermediaries like wholesalers and retailers are used to reach consumers.
• What does direct distribution refer to?

  Selling without intermediaries
• Match the advantage with the corresponding description in direct distribution:

  Higher profits ↔️ No intermediary fees

  Better customer control ↔️ Direct feedback and interaction

  Enhanced customer relationships ↔️ Personalized service and trust
• What is indirect distribution?

  Using intermediaries to sell
• Wholesalers buy in bulk and distribute to retailers.
• Retailers sell directly to consumers in indirect distribution.
• Arrange the advantages of indirect distribution in logical order:

  1️⃣ Wider reach through retail networks

  2️⃣ Lower upfront costs for producers

  3️⃣ Reduced inventory management
• In indirect distribution, lower profit margins are due to intermediary fees.
• What is a disadvantage of indirect distribution regarding customer experience?

  Less control over interactions
• Match the distribution type with its primary advantage:

  Direct Distribution ↔️ Higher profits

  Indirect Distribution ↔️ Wider reach
• What is the primary advantage of indirect distribution compared to direct distribution?

  Broader consumer access
• Indirect distribution involves using intermediaries like wholesalers and retailers.
• Wholesalers buy in bulk and distribute to retailers