What is a distribution model?

The distribution model is a method that companies use to send products from the point of origin to the final selling point. The classic model includes at least three different parties: the manufacturer of goods, distributors or warehouses and a retail store that represents the final selling point. Over time, the distribution model can experience changes that shift the responsibility of these parties. These models - also called supplier chains in some cases - can add costs or other problems of common business activities. Changing a distribution style or method can help the company achieve better results both in the profitability and reputation of the brand. The main problem in this model is the simple fact that each side works for its own benevolence. For example, the manufacturer focuses on the production of goods at the lowest possible costs. Transport or distribution -offs on Ibuce must also be kept to a minimum for the company to achieve maximum profitability. The wholesale or distributor attempts to get inThe manufacturer pays high prices for the transfer of goods to retailers, because this mediator wants profits for his own activities.

The use of a short distribution model usually costs less and results in shorter downtime when the retailer experiences shares. For example, a manufacturer that produces high demand item must have a distribution model that can often provide retailers to maximize sales. Paying bonuses for this type of distribution service may not be a problem, as profits from abundant sale of highly required products compensate for distribution costs. In some cases, a large company can be able to create its own distribution service by developing a distribution that can send goods to retailers. This model can result in a company that has frequent interaction with customers due to a short supply chain.

retailers are also important in DSTribution model for manufacturers. Sending goods to incorrect retailers can result in customers who do not want to buy these specific shops for specific goods. For example, small retailers who do not have many places in the regional area mean that the customer must continue to buy goods. In addition, the sale of goods on the international market requires the correct use of the distribution model. Creating relationships with the right partners can help the company build on the local market of strong links.