Distribution channels

Distribution
Recent activity on Oct 12, 2018
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Anonymous A asked on Oct 12, 2018

Do a distribution channel have to face the end customer? Or could a manufacuring company sell to a different manufacturing company (here considered a distribution channel), which sells it to a retail store? What are possible distribution channels for manufacturing companies?

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Guennael
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replied on Oct 12, 2018
Ex-MBB, Experienced Hire; I will teach you not only the how, but also the why of case interviews

In my own company (Samsung), the customer (who buys your product, such as the retailer) is distinct from the consumer (who ends up buying it from the customer and is the one actually using the product).

Our distribution channels can be brick & mortar retailers (Best Buy, Costco or Walmart in the US), cell phone carriers (AT&T or Verizon) or even e-tailers (Amazon)

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Anonymous replied on Oct 12, 2018

A distribution channel is, in essence, the way a firm sells it's product to whoever buys it.

As Benjamin illustrated well, there are many types of distribution channels, also based on the firm's business model (e.g. B2C vs B2B). So for a manufacturing firm, their distribution channel just depends on their business model and how they sell. If they produce an intermediary product that is purchased by another manufacturing firm, then their distribution channels relate to how they sell to that firm (i.e. sales executives, online channel, etc.).

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Benjamin
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replied on Oct 12, 2018
ex-Manager - Natural and challenging teacher - Taylor case solving, no framework

Hi,
You're question is a little bit confusing, but I'll do my best to answer.
As manufacturer several distribution channel are structurally possible :

- Direct to end user

- indirect : several options possible

- Distributors : who sell to end customer

- OEM / system integrators : this is particularly true in B2B, where a product can be integrated in a broader system
- service provider : again in B2B, there could people offering service to end customer which will require use of your product

Best
Benjamin

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Guennael

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