Author: M.Crump

A producer supplies goods or services.

Wholesalers buy products in bulk and supply in smaller quantities to retailers. Some wholesalers, like Costco, sell through cash and carry stores. Wholesalers can offer advice and transport services to retailers. Selling to a few big wholesalers reduces the transport costs for manufacturers (because it is a lot cheaper than transporting to lots of retailers). It also means the manufacturer has fewer deals to negotiate.

Retailers are shops that sell goods and services to the final customers. These retailers are at the end of the chain of distribution.

Mail-order firms produce catalogues and customers order from these. The businesses do not have physical retail outlets.

This is where businesses sell their products over the telephone. They may telephone people hoping to convince them to buy their product or simply take orders over the telephone rather than having a shop.

Intermediaries:
Advantages: - Producer can access more customers - Allows consumers to compare brands Disadvantages: - Price increased at each stage - Lose control of how product is promoted

Many businesses now sell a range of producer’s products online. They do not necessarily have a physical shop where people can go—they simply have a website where orders can be placed.
Mail order, telesales and online selling are all examples of direct marketing. The manufacturer sells direct to the customer.