Distribution Systems

It is a business structure and interdependent organizations ranging from the point of origin of the product to the
consumer. A distribution channel consists of individuals and companies involved in the transfer of ownership of a
product as it passes from the manufacturer to the end consumer or industrial user.
General Structure Distribution channels
WHOLESALER
CHANNELAGENTBROKER

WHOLESALERWHOLESALER

RETAILER

LONGINDIRECTCHANNE

RETAILER

FINALCONSUMER

PROVIDER

SOURCES OF RAW MATERIAL

PRODUCER

AGENT

RETAILER
INDIRECTCHANNELSHORT
DIRECTCHANNEL

The above is the general structure of distribution channels present in all distribution networks and used by different
companies to make available to the final consumer products and services. Furthermore, the distribution channels
require updates evolve and processes as a result of the changes occurring in the environment.

CONSUMERS
END

1. Functions flows distribution channels

Physicist
Production Control
Promotin
Negotiation
Financing
RETAIL
Risk
Order
Payent

Physicist

The following graph shows the different functions performed channel members shown sequentially.
Production Control
Promotin
Negotiation

Physicist

MAYORIST

Financing

Production Control

Order

Promotin

Payent

Negotiation
2. characteristics that identify distribution channels
Financing
Risk
Order
DISTRIBUTIONCHANNELS

INVESTIGATE

Payent

DIRECT

LENGTH

FUNCTIONS

PROMOTE

FEATURES

PRODUCER

FUNCTIONSOFDISTRIBUTIONCHANNELS

INDIRECT

DISTRIBUTIONCHANNELS

SHORT

Estructure of
Distribution Channels

NEGOTIATE

FINANCE

LONG
AGENT

INTENSITY

TYPE

RETAIL

EXCLUSIVE

CRITERIAOFSELECTION
PRODUCTCONTROL

EXTENSIVE

WHOLESALER
SELECTIVE

INTENSIVE

COSTS
MARKETCOVERAGE