A Closer Look at Retail Distribution The marketers all over the world use different models and strategies for marketing a product or brand and one such model is the producer-oriented model proposed by the marketer E. Jerome McCarthy, in 1960. As part of this model, McCarthy identified four elements for an effective marketing strategy. Referred to as ‘4 Ps’, the four elements are product, price, and promotion and place (distribution). Let’s look at distribution in detail to understand the importance of distribution, the different models or channels of distribution and the solution available to the enterprises for improving productivity, reducing costs and accelerating time to market. Distribution is an important aspect of supply chain management as it is the activity of getting the finished goods from the point of origin to the point of consumption. Wikipedia defines distribution as “the process of making a product or service available for use or consumption by a consumer or business user, using direct means, or using indirect means with intermediaries.” Simply put, retail distribution is the manner in which goods find its way from the manufacturer to the shops where the consumers purchase them. Today there are different distribution channels or models available to enterprises for getting the products to the consumers. The following are some of these models.
Traditional Warehousing / Distribution In this model, the goods are shipped to retail distribution centers where they are stored until store orders are fulfilled. Once it is fulfilled, the goods are delivered to the stores.
Direct to Store Delivery Here the goods are shipped directly to retail store outlets with no warehousing in between.
E-Commerce This allows retailers to access clients and vice-versa all over the world.
Dropship Distribution This distribution channel is for those online and catalog retailers who do not stock inventory. Once the order is placed, the wholesale distributor directly ships the products to the retail clients.
Today the retail distribution activities of most enterprises are not restricted at the local level or national level. Instead, it is more globalized. In such a scenario, global supply chain management is an important issue for enterprises. The best possible solution for those enterprises looking to save company time and money and to be freed from the annoyance of managing distribution and transportation of products is to entrust this responsibility to good third party supply chain solution providers. They would do everything from packaging products for installation or store shelves, shipping products directly to the retailer, distributor, or any other destination to filling orders directly. Retail distribution is a crucial phase in the supply chain process and therefore enterprises must be very careful when taking decisions regarding it. Read more about : evaluation system