What is a distribution channel?

A distribution channel is the route followed by a product in question until it reaches its final destination.

Thus, the concept of the distribution channel is understood as the process that comprises a product from its starting point to its end point. That is, from the time it is sent by its producer until it is received by the consumer, not without forgetting the intermediaries through which it passes. For this reason, the distribution channel of a company must be as fast as possible and at the same time efficient.

The intermediaries of the distribution channel

Every distribution channel is made up of two main intermediaries, who between them will define how this process evolves and how it is organized. The three most important intermediaries in the distribution channel of any product are:

  • Producer: those who make the product.
  • Wholesaler: is in charge of selling to other wholesalers, manufacturers or retailers but they never usually sell the product or service directly to the final consumer.
  • Retailer: also known as retailer, they are those who sell the products directly to the final consumer. They are the ones that close the last phase of the distribution channel.

How distribution channels are classified

The classification of distribution channels is recorded according to their length and the time established from when the product is manufactured until it reaches the final consumer:

  • Long distribution channel: it has several levels and the product takes longer to reach the consumer, since to go from the producers to the consumer you have to go through wholesalers and retailers several times. They are four levels or more in their entirety.
  • Short distribution channel: There are three levels in their entirety: from producer to retailer and from retailer to consumer.
  • Direct distribution channel: the product goes directly from the producer to the consumer.

Know all the information about the product distributionand design the most convenient strategy for your company, taking into account the different factors that intervene in it.

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