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The fourth P of marketing is Place. If a product is very good, well promoted and the best prices offered still customers would not be able to buy if it is not easily available to them. Thus, distribution is of vital importance.
There a four ways through which a product reaches the customers. These are also known as Channel of distribution.

Channel 1

Direct marketing from producer to consumers

Usually common for industrial products, it has become very popular in the consumer market with the improvement in communication technology. It is usually employed by specialist mail-order manufacturers and factory outlets.

Channel 2

Manufacturer –retailer-consumer

The rise of large supermarkets chain has reduced the importance of the independent wholesaler. These retail chains buy in bulk and thus deal directly with the manufactures and undertake their own wholesale functions. E.g. Carrefour, Wal-Mart and Tesco.

Channel 3


This is the traditional channel in consumer goods market. Small retailers depend on wholesalers for supplies and manufacturers are also keen to avail themselves the services of wholesalers. The wholesaler buys in bulk from the producer and distributes to small retailers in according to their needs.

Channel 4


This channel is common when manufacturers want to sell their products in a foreign market. Because of the unfamiliarity to the foreign market the manufacturer takes the help of an agent who assists in the movement of goods through the network of wholesalers and retailers.

channels of distribution

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