explain the journey of goods from factories to wholesalers and retailers
Answers
From the time a product is ready for sales to target customers it goes through various wholesalers and agents before landing at the retail stores. Depending on the product type and target customers, manufacturers choose a distribution line which will bring them highest profits and also help compete with others in the market. Along with convenience store brokers and agents, manufacturers use specific distribution channels and distributors best suited to their products. During distribution and sales of products through convenience stores, manufacturers also have to keep in mind the cost factor when their product reaches the store as selling products through convenience store is more expensive than supermarket.
To retain a hold over the distribution and sales of their products in the initial stages, manufacturers take the responsibility of distribution during the initial years of business within local markets which helps them understand customer feedback instantly. This exercise enables manufacturers to improve their product at the local level itself and with minimal loss in marketing and distribution. Food distribution requires a specialized group of distributors as these products have to be transported and consumed within a short period of time. When other convenience goods like cigarettes, cosmetics and other household products are distributed which do not have a limited shelf life then transportation and distribution can take longer time.
Every channel of product distribution comprises of producers, retailers, distributors and wholesalers before it reaches the end consumers. Every producer/manufacturer/creator can choose from numerous avenues of distribution to get the products before consumers across state and national boundaries. To keep the product in demand and make it available to buyers at a competitive price, manufacturers have to constantly maintain feedback from users and improve the product.
Every distribution channel contains four essential individuals namely manufacturer, wholesaler, distributor and retailer before it reaches the consumer. While small retailers directly deal with wholesalers as they require limited quantities, large warehouse retailers directly work with manufacturers as they are able to buy in large quantities and use their own warehouses and transportation for moving the products across their stores.