what is direct channel of distribution
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Direct vs. Indirect Distribution Channel: What's the Difference?
By SEAN ROSS
Updated Apr 19, 2019
Direct vs. Indirect Distribution Channel: An Overview
A distribution channel is a chain of businesses or intermediaries through which a good or service passes until it reaches the end consumer. Channels are broken into direct and indirect forms.
Distribution channels can include the manufacturer, warehouses, shipping centers, retailers and even the internet. Direct channels allow the customer to buy goods directly from the manufacturer, while an indirect channel moves the product through other distribution channels to get to the consumer.
Firms that use direct distribution require their own logistics teams and transport vehicles. Those with indirect distribution channels must set up relationships with third-party selling systems.
Produced goods and services have to find a way to reach consumers. The role of the distribution channel is to transfer goods and services efficiently. They can either be sent to a retail store or directly to a customer's residence.
There are advantages and disadvantages to direct distribution channels. The same goes for indirect channels. It is the job of the managers and others involved in corporate governance to find the most effective means based on the firm's specific needs.
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