1. Distribution Notes Channels of Distribution

2. Channel of Distribution The pathway from a producer/manufacturer to the final user Manufacturer Middlemen - Intermediaries Final User -Consumer -Industrial User

3. Producer/Manufacturer The company who produces/creates the product(s) that will be sold to the market

4. Agent Does not own the goods they sell Brings buyers and sellers together Independent Manufacturer RepBroker -Paid for what they sell- Paid commission - Negotiate - Look for new customers

5. Wholesaler Wholesalers Buy large quantities from manufacturers Store the goods Resell goods to other businesses Take title to the goods they sell for resale Rack Jobbers Manage the inventory Count stock, maintain displays Provide racks for display Bill retailer for goods sold CDs, cosmetics Drop Shippers Own the goods they sell Do not physically handle the merchandise or product Shipped directly to buyers Deals in large quantity bulk Coal, chemicals, lumber

6. Retailer Buy from wholesalers Final link from manufacturer to consumer Non-store retailing Vending machines Direct mail Catalog TV Shopping Internet (e-tailing)

7. Consumer Final User Consumer – product purchased for personal use Industrial User – product purchased for use in a business

8. Consumer Distribution Channels

9. Distribution Channels - Consumer Products Channel AChannel BChannel CChannel DChannel E

10. Distribution Channels - Consumer Products Channel AChannel BChannel CChannel DChannel E Manufacturer/ Producer Consumer

11. Channel A Direct Distribution 5 ways direct distribution is used for consumer goods: 1.Selling products at the production site 2.Having a sales force call on consumers 3.Using catalogs or ads to generate sales 4.Using telemarketing 5.Using the Internet to make online sales

12. Distribution Channels - Consumer Products Channel AChannel BChannel CChannel DChannel E Manufacturer/ Producer Retailer Consumer

13. Channel B Most commonly used channel for merchandise that dates quickly or needs servicing

14. Distribution Channels - Consumer Products Channel AChannel BChannel CChannel DChannel E Manufacturer/ Producer Wholesaler Retailer Consumer

15. Channel C Most common method for staple goods Staple Goods - items that are always carried in stock and whose styles do not change frequently

16. Distribution Channels - Consumer Products Channel AChannel BChannel CChannel DChannel E Manufacturer/ Producer Agent Wholesaler Retailer Consumer

17. Channel D For manufacturers who wish to concentrate on production and leave sales and distribution to others

18. Distribution Channels - Consumer Products Channel AChannel BChannel CChannel DChannel E Manufacturer/ Producer Agent Retailer Consumer

19. Channel E Selected by manufacturers who do not want to handle their own sales to retailers The agent simply brings the buyer and seller together.