1. Place AKA Distribution Locations and methods used to make products available to customers

2. Channels of Distribution • Routes products and services take from production to consumption • Finding the most efficient channel means saved time and lower costs for both buyers and sellers • Direct –from manufacturer to consumer • Indirect- uses intermediaries like agents and wholesalers to expand the market

3. Four Basic Channels of Distribution

4. Manufacturer to Consumer • Internet, direct mail, television shopping • Most cost effective but sales opportunities are limited

5. Manufacturer to Retailer to Consumer • More expensive but more sales opportunities

6. Manufacturer to Wholesaler to Retailer to Consumer • Reach a larger market • Wholesaler stores and sells the product • Prices lower because of mass quantities produced

7. Manufacturer to Agent to Wholesaler to Retailer to Consumer • Manufacturer does not sell • Agent does the selling • Usually used in international marketing

8. Physical Distribution Transportation Storage Handling Packaging A product may move through several channel members and various forms of transportation before it gets to the consumer.

9. Transportation • Plane, pipeline, train, boat, truck, bike or a combination of these • You must decide which method is most cost efficient What are you shipping? Where is the product going? Do you need refrigeration or special methods?

10. Product Storage and Handling • Efficient storage allows channel members to balance supply and demand • Adds to the cost • Adds to risk of damage or loss

11. Packaging • Designed to protect the product between production and consumption • Keep product from damage or destruction • Packaging requirements • Shipping method • Where it is going?

12. Finding Distributors • The American Wholesalers and Distributors Directory - lists suppliers • The Thomas Register - lists manufacturing companies • Trade magazines

13. Daily Grade • Apples, MP3 Players, Magazines, Milk, Motor Oil, T-shirts, DVDs • Two people per group • One computer • Choose one of the products above • Create a flow chart showing all of the channels of distribution possible for the product. (don’t guess…look it up!) • Type each person’s name on the header, save, print, and turn in