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Types of Channels

Types of Channels. BMI3C. Distribution Policies. Intensive, Selective, Exclusive, Integrated Which policy would be best for a new… Chocolate bar from Hershey Sports car from GM Line of outerwear from Roots Golf club from Taylor Made. Direct Channels.

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Types of Channels

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  1. Types of Channels BMI3C

  2. Distribution Policies • Intensive, Selective, Exclusive, Integrated • Which policy would be best for a new… • Chocolate bar from Hershey • Sports car from GM • Line of outerwear from Roots • Golf club from Taylor Made

  3. Direct Channels • Customer buys directly from the producer • No intermediaries • An integrated distribution policy is direct • Farmers’ Market • Bakery • Restaurant • Avon • Roots

  4. Indirect Channels • Goes from producer to customer through one or more intermediaries • Importers • May or may not have exclusive rights to distribute a product in their country • Sometimes they seek out new products to import, sometimes they are contacted by a manufacturer looking to expand • Agreements are contracted for a specified period of time

  5. Indirect Channels • Wholesalers • Buy from manufacturer and sell to retail stores or other businesses • Many manufacturers have minimum orders that they will ship, which are too big for smaller retailers • Key functions • Breaking bulk • Risk bearing • Financing • Buying • Transporting • Managing • Promoting • Providing market information

  6. Indirect Channels • Retailers • The “front line” – sell directly to consumer • Must have the right… • Merchandise • Price • Time • Place • Quantity

  7. Specialty Channels • Indirect channels of distribution that do not involve a retail store • Vending machines • The Internet • Catalogues • Telemarketing • Television sales

  8. Activity • For your assigned topic, list the advantages and disadvantages of this channel • Cite some examples of companies/products that use this form of distribution

  9. Activity • Which channel of distribution would you use for each of the following goods or services? • Explain the rationale for your choices • Fresh flowers • Clothing items • A one-week holiday in the Bahamas • A Blu-Ray player

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