Channels of Distribution Class 12 Notes

Channels of Distribution Class 12 explains the different distribution channels which a manufacturer can follow to deliver a product to the ultimate consumers. The channel can be direct or indirect. A detailed explanation of the topic is given below.

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Channels of distribution Class 12

Physical distribution means the transfer of goods and making them available at the right place in the right quantity and to the right people. It has two main aspects. First is the physical movement of goods from one place to another. Second, deciding the channel of distribution for that physical movement.

Channel of distribution class 12 means all the people who come together in helping and assisting in the transfer of the title of goods and services from the producer to the consumer. These people are the middlemen such as wholesalers, retailers, agents, merchants, institutions etc. There are various benefits of the channels of distribution such as economies of effort. The efforts can be saved as the work will be distributed over a large number of people. It helps in reaching large geographical areas where it would have been difficult for the producer to reach single-handedly. They also bring efficiency to distribution.

Types of distribution channels Class 12

There are various types of channels of distribution. They are described as under:

Based on the factors such as costs, geographical area to be reached, product type, the channel of distribution from these different channels of distribution can be selected.

• Direct channel
• Indirect channel

Direct channel 

This channel is also known as zero level as it does not involve any middlemen between the producer and the consumer. It is the simplest and quickest channel of distribution. This channel is helpful for those producers who want to maintain a direct connection with the consumers. For example: ‘Bata shoes’ has its own outlets and this means that the producer is selling his products directly to the consumers without appointing and wholesaler or retailer in between. This helps in lowering the cost involved. Online selling or internet selling is the new form of direct selling or zero-level channel of distribution.

Indirect channels under Channels of Distribution Class 12 

The indirect channel of distribution involves people between the producer and consumers. Depending on the number of middlemen these indirect channels of distribution can be classified as under:

One level channel

Channels of Distribution Class 12 explains that Producer – retailer – consumer: this channel of distribution involves the least number of middlemen i.e. single middlemen, a retailer. In this channel, the goods will be transferred from the producer to the retailer and then finally to the consumer. This channel is helpful in quick sales. As the chain is small. It also helps in covering a wider area than the zero-level channels. For example, the electronic goods of Sony and Panasonic are sold to retailers and then to the consumers without involving other middlemen in between.

Two level channel

Producer – wholesaler – retailer – consumer: this channel of distribution is most common and includes two middlemen i.e. wholesaler and retailer. The wholesaler takes the bulk quantities of the product from the producer and then sells it in smaller quantities to the retailers. This helps in larger coverage of the area for the product. For example, cloth market runs on this structure.

Three level channels

Producer – agent – wholesaler – retailer – consumer: this channel involves one more middleman i.e. an agent or a broker. The agents help in reaching larger geographical areas as they contact different wholesalers. Different agents are appointed for different areas to make a greater reach.

Channels of Distribution in Marketing Class 12 concludes that different channels of distribution are important as it increases the area for the producer and helps him cover a larger area.

BST Chapter 11 – Marketing

1. Marketing Management
2. Marketing Management Philosophies
3. Functions of marketing
4. Marketing mix
5. Products – Classification of Products
6. Branding
7. Packaging – Levels , Functions & Importance
8. Labelling
9. Pricing – Factors affecting Price of a Product or Service
10. Components of Physical Distribution
11. Channels of Distribution
12. Advertising – Benefits, Limitations, Objections
13. Personal selling
14. Sales promotion
15. Publicity – Characteristics and Objectives