Place and methods of distribution

Overview

Distribution channels, retailers and e-tailers with their advantages and disadvantages, click and collect, online marketplaces, and how e-commerce has changed UK high streets.

What you need to know

Answer each one before you reveal it.

Questions from this subtopic

Each one with the model answer underneath.

1. 1

   Why is the choice of distribution method important to a business?

   Model answer

   The right channel puts the product where target customers expect to find it. The channel also affects costs, prices and the brand's image.

2. 2

   What is a distribution channel?

   Model answer

   A distribution channel is the route a product takes from producer to consumer. The route may pass through wholesalers and retailers or go direct.

3. 3

   What is a retailer?

   Model answer

   A retailer is a business that sells goods to consumers, usually from physical shops. Tesco and Boots are UK retailers.

4. 4

   What are the advantages of selling through retailers?

   Model answer

   Retailers let customers see, touch and try products before buying. Shops can offer advice and let customers take goods home immediately.

5. 5

   What are the disadvantages of selling through retailers?

   Model answer

   Retailers take a share of the price, cutting the producer's profit. Shops have high running costs such as rent and staff wages.

6. 6

   What is an e-tailer?

   Model answer

   An e-tailer is a business that sells to consumers online, through a website or app. ASOS is a UK e-tailer.

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