Place (Edexcel GCSE Business)

Methods of Distribution

• Place in the marketing mix refers to where customers purchase the businesses products/services

• Distribution channels refer to the various intermediaries through which goods/services move from the business to the end customer 

Three stage distribution channel

• The three stage distribution channel moves the product directly from the producer to the retailer who then sells to to the final customer

• This channel is often used for products with high profit margins, where the manufacturer can afford to sell directly to the retailer and still make a profit

  • Eg Toshiba produces laptops and sells them directly to retailers like Currys, who then sells them to the end customer  

Two stage distribution channel

• The two stage distribution channel moves the product directly from the manufacturer to the end customer

• This channel is commonly used for products that are sold online or through direct sales channels and is referred to as e-tailing

  • E.g. RyanAir sells its service (passenger tickets) directly to the end customer on their website

Using E-Commerce to Generate Sales

• Changes in distribution have been impacted by social trends such as the growth of e-commerce and the shift from product-based businesses to service-based businesses

• By understanding these trends, businesses can adjust their distribution strategies to better meet the needs of their customers and stay competitive in the marketplace

 The Growth of E-commerce