Distribution - this endless race for profit

product does not fall to the end user once it passes a certain way.How to travel this distance is called the "distribution" (or distribution, both options are considered correct).Distributio Latin word literally translates to distribution.But to say that the distribution - it's just distribution of goods, could be twenty-five years ago.

Now this process is more complex, multi-step.Especially that it is necessary to distribute the product so that it does not lay on shelves dead weight.Since then, when people refused to barter and switched to commodity-money relations, humanity perfected the art called "distribution of goods".The system of relations, each has its own specialty.The factory produced, made the margin sufficient for the resumption of the production cycle, the payment of all expenses and further development.Then passed to the next link.They made the trade mark and sent on.So to the final consumer.

If the manufacturer does not want to share, it will have to create its own distribution network, the assembly line has no one tried to sell.And the creation of its retail outlets - it costs a lot, so it's best to everyone to do their work.

Distribution - a process that is impossible without a distribution channel.

Their levels:

  • manufacturer - the consumer.To this end, as already mentioned, it is necessary to create a distribution network.Exception - fast food: fried sausage, sold here.
  • manufacturer - retailer - consumer.Level, suitable for small and medium producers.
  • manufacturer - wholesaler - retailer - consumer.So to us gets the bulk of the goods.
  • manufacturer - wholesaler - small wholesale dealer - retailer - consumer.This is the level of multinational companies.For him to come to us, for example, cigarettes, household appliances, mobile phones.

With the existing level of competition today, distribution - a process that is equally important for all participants.Whatever may have been a wonderful product if distribution channels do not work well, will take place on the shelf competitors.So, before you sign a distribution contract manufacturer (which has promoted trade mark) long studies of the potential partner.We consider his haul and storage logistics, the coverage area, the level of training of sales personnel, financial opportunities.

at wholesaler contract imposes many obligations.But the benefits it promises a serious (if it is a well-known brand).For him distribution - the obligation to pump through its distribution channels distribyutiruemogo minimum stipulated quantity of goods in stock have a minimum balances (for example, in the amount of monthly sales), to maintain strictly the terms of payment, provide merchandising retail chain, purse spending stocks and so on.

But for this he receives the minimum price on the territory of the incoming distribution, the exclusive right of wholesale trade within it (ie in the area he is the only representative of the manufacturer).

Illustration benefits direct contract - beverage distribution group "BBH" (beer and beverages "Baltica").The exclusive right to the territory and direct deliveries from the manufacturer provide an opportunity for a short time from a small wholesaler to become a major market participant.