Why Distribution Channel?

Facilitates searching process

Facilitates process of exchange by making the

products or services available for use

Standardizing transactions which makes

exchange more effective and efficient
Why Distribution Channel?

Adjust the discrepancy of assortment through the

performance of sorting process

Breaking Heterogeneous supply into separate stocks

which are relatively homogenous called sorting out
Bringing similar stocks from a number of sources
together into a larger homogenous supply called
accumulation
Breaking a homogenous supply into smaller and smaller
lots called allocation
Building up of assortment of products for resale in
association with each other called assortment
 Activities of Distribution
Channel

Discrepancies between typical production activity and

consumption activity

Spatial Discrepancy
Temporal Discrepancy
Need for breaking the bulk
Need for assortment
Information Discrepancy
 Channel Flows

Physical possession flow

Ownership flow
Promotion flow
Information flow
Financing Flow
 Ideal Channel Design

Cost of performance

Criticality of Performance

Value addition