Quick Answer: What Are The Criteria For Selecting Channel Of Distribution?

What are the factors to consider when choosing a distribution channel?

When selecting the right combination of channels for the sales and distribution of products and services, international trade practitioners consider several factors.Target market buying behaviours.

Product and service characteristics.

Market location.

Competition.

Local business practices.

Legislation.

Market coverage.More items…•.

What are the 4 channels of distribution?

While a distribution channel may seem endless at times, there are three main types of channels, all of which include the combination of a producer, wholesaler, retailer, and end consumer. The first channel is the longest because it includes all four: producer, wholesaler, retailer, and consumer.

What is channel strategy?

Channel strategy consists of selecting the type of channel, determining the desired intensity of distribution, designing the channel configuration, and managing the channel on an ongoing basis. It’s essential for product and/or service distribution to your target markets and potential customers.

How do I manage my channel members?

The channel management process contains five steps….The Channel Management ProcessAnalyze the Consumer. We begin the process of channel management by answering two questions. … Establish the Channel Objectives. … Specify Distribution Tasks. … Evaluate and Select Among Channel Alternatives. … Evaluating Channel Member Performance.

What is the best distribution channel?

Employee management and productivity E-commerce is the most efficient distribution channel available for a business. It decreases dramatically the need to use multiple storage locations, multiple distributers and brokers to connect you to retailers to sell your product line.

How do you create a distribution channel?

Evaluate If You Should Pursue Adding a New Distribution Channel. Distribution is a key element of your marketing strategy – it’s how you access your market. … Define What Your Channel Will Look Like. … Find Channel Partners and Create Your Channel Plan. … Create Your Channel Pricing Strategy.

What are the criteria for selection of channel member?

Channel Member Selection Criteria by PegramCredit & Financial Condition.Sales Strength.Product Lines.Reputation.Market Coverage.

When selecting a distribution channel A company should consider?

Selecting a distribution channel can directly impact a product’s success. There are five key factors to consider: Size of the market—includes the variety of customer profiles. Cost of the distribution channel—absolute value cost, cost per customer, profitability of different channel options, fixed versus variable costs.

What are the function of channel of distribution?

The basic function of a distribution channel is to provide a link between production and consumption and to create time, place and possession utilities which constitute the added value of distribution.

What are the 3 distribution strategies?

There are three methods of distribution that outline how manufacturers choose how they want their goods to be dispersed in the market.Intensive Distribution: As many outlets as possible. … Selective Distribution: Select outlets in specific locations. … Exclusive Distribution: Limited outlets.

How do you evaluate channel members?

Sales is the most popular performance criteria used in channel evaluation. Sales might further be subdivided into current sales compared with historical sales, comparisons of sales with other channel members, and comparisons of the channel member’s sales with predetermined quotas.

What are the factors affecting channel distribution?

5 Important Factors Affecting the Choice of Channels of Distribution by the ManufacturerUnit Value of the Product: … Standardised or Customised Product: … Perishability: … Technical Nature: … Number of Buyers: … Types of Buyers: … Buying Habits: … Buying Quantity:More items…