What is Distribution Channel?
Distribution Channel refers to the path through which a product or service reaches its end consumers. It involves a series of intermediaries who facilitate the movement of goods and services from the manufacturer to the final user.
The importance of a distribution channel lies in its ability to create efficiency in the supply chain. By utilizing appropriate channels, businesses can save time, reduce costs, and improve customer satisfaction. Here's an overview of how it works:
Manufacturers produce goods or services which then move through various intermediaries such as wholesalers, distributors, retailers before reaching consumers. Each intermediary adds value by performing specific functions such as sorting, storing, transportation and financing.