Question

Five Mark Questions:-
What is meant by 'Indirect channels of distribution'? Explain which indirect channel of distribution would you adopt for consumer goods and why?

Answer 1

When a manufacturer employs one or more intermediary to move goods from the point of production to the point of consumption, the distribution network is called indirect.

Consumer products, on the other hand, are usually standardised, less expensive, less bulky, non-technical and frequently bought products. These can be better distributed by long network of channels, involving many middlemen. Perishable products like fruits, vegetables, and dairy products are best sold through short channels, while non-perishable products like toiletry products (e.g., soap, toothpaste, hair oil etc.), groceries (vegetable oil, tea leaf etc.), fabrics require longer channels to reach wide spread consumers.