TEERTHANKER MAHAVEER UNIVERSITY, MORADABAD

COLLEGE OF LAW & LEGAL STUDIES

UNIQUE ASSIGNMENT
SUBMITTED FOR THE REQUIREMENT OF CLASS TEST 2
EVEN SEMESTER SESSION 2019-20

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Program Name: B.B.A LL.B(H)

Name of Student: Suyash Khanna

Semester: 4th Semester.

Enrolment: TLL1802011
Course Name: Fundamentals of Marketing.
Course Code: LBB404
Date of Submission:

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Question: Describe various objectives & functions of distribution

channel.
Answer:
# Meaning & Definition:

A distribution channel is a chain of businesses or intermediaries through which a good or service

passes until it reaches the final buyer or the end consumer. Distribution channels can include
wholesalers, retailers, distributors, and even the Internet. distribution channel is a path by which
all goods and services must travel to arrive at the intended consumer. Conversely, it
also describes the pathway payments make from the end consumer to the original vendor.
Distribution channels can be short or long, and depend on the number of intermediaries required
to deliver a product or service.
Goods and services sometimes make their way to consumers through multiple channels—a
combination of short and long. Increasing the number of ways a consumer is able to find a good
can increase sales. But it can also create a complex system that sometimes makes distribution
management difficult. Longer distribution channels can also mean less profit each intermediary
charges a manufacturer for its service. Distribution channel refers to the network used to get a
product from the manufacturer or creator to the end user.
In short, the distribution channel can be defined as ‘the path through which goods and services
or payment for those goods or services travel from the vendor to the consumers’.
Distribution channel can be as short as a direct transaction from the vendor to the consumer, or
may include several interconnected intermediaries along the way such as the followings –
1. Wholesalers
2. Distributors
3. Agents and
4. Retailers

The above mentioned are the channels of distribution. A channel of distribution or trade channel
is defined as the path or route along which goods move from producers or manufacturers to
ultimate consumers or industrial users. In other words, it is a distribution network through which
producer puts his products in the market and passes it to the actual users.
One of the ways to understand the concept of channels of distribution is to observe from where
consumers get their items of consumption. Consumers rarely buy products directly from the
companies that make and market them. Products such as television, shoes, tea, sewing machine,
and paper are purchased from retailers.
Retailers procure their products from wholesalers. Wholesalers in turn get their stock of products
from the producing companies. Therefore, products pass through a chain of partners called
intermediaries or channel partners. This chain of participating firms or partners constitute the
channel of distribution.
# Objectives of Distribution Channel:

The main objectives of distribution channel are as follows:

1. Receiving Fast and Accurate Feedback of Information:
In order to maintain and provide an efficient distribution system and service, a good and regular.
How of relevant information is necessary, which includes inventory levels, sales trends, damage
reports, service levels, cost monitoring etc.
2. Making the Product Readily Available to the Market Consumers:
To ensuring the product is represented in the right type of outlet or retail store is an important
objectives of channels of distribution. Having identified the correct marketplace for the goods,
the company must make certain that the appropriate physical distribution channel is selected to
achieve this objective.
3. Achieving a given Level of Service:
Once again, from both the supplier’s and the customer’s viewpoints, a specified level of service
should be established, measured, and maintained. The customer normally sees this as crucial and
relative performance in achieving service level requirements is often used to compare suppliers
and may be the basis for subsequent buying decisions.
4. Enhancing the Prospect of Sales being Made:
The most appropriate factors for each product or type of retail store will be reflected in the
choice of channel. The general aims are to get good positions and displays in the store; and to
gain the active support of the retail salesperson, if required. The product should be “visible,
accessible, and attractively displayed’.
5. Minimizing Logistics and Total Costs:
Costs are very crucially significant as they are reflected in the final price of the product. The
selected channel will reflect a certain cost and this cost must be assessed in relation to the type of
product offered and the level of service required.
6. Achieving Co-Operation with Regard to any Relevant Distribution Factors:
These factors can either be from the supplier’s or the receiver’s point of view and include
minimum order sizes, unit load types, product handling characteristics, materials handling aids,
delivery access (e.g., vehicle size), and delivery time constraints, etc.

# Functions of Distribution Channels:

The main functions of distribution channels are as follows:

● Distribution channels provide time, place, and ownership utility. They make the product
available when, where, and in which quantities the customer wants. But other than these
transactional functions, marketing channels are also responsible to carry out the
following functions:
● Logistics and Physical Distribution: Marketing channels are responsible for assembly,
storage, sorting, and transportation of goods from manufacturers to customers.
● Facilitation: Channels of distribution even provide pre-sale and post-purchase services
like financing, maintenance, information dissemination and channel coordination.
● Creating Efficiencies: This is done in two ways: bulk breaking and creating
assortments. Wholesalers and retailers purchase large quantities of goods from
manufacturers but break the bulk by selling few at a time to many other channels or
customers. They also offer different types of products at a single place which is a huge
benefit to customers as they don’t have to visit different retailers for different products.
● Sharing Risks: Since most of the channels buy the products beforehand, they also share
the risk with the manufacturers and do everything possible to sell it.
● Marketing: Distribution channels are also called marketing channels because they are
among the core touch points where many marketing strategies are executed. They are in
direct contact with the end customers and help the manufacturers in propagating the
brand message and product benefits and other benefits to the customers.