Factors to Be Considered When Selecting a Distribution Channel

  1. Customer characteristics – This include type of customer, geographic dispersion of buyers i.e. location to manufacturers, customer buying habits and the outlets they purchase from.
  2. Product characteristics – This includes perishability, product usage (industrial-direct or household-indirect).
  3. Company characteristics – This includes company objectives, financial status, past channel experiences and the desired degree of channel control.
  4. Middle men characteristics – This includes financial status, storage capacity, availability and the services they offer.
  5. Competitive characteristics – For some products, it is preferable to use the channels that are used by other competitors e.g. fast moving consumer goods.
  6. Environmental characteristics – This includes economic, political, legal, social, cultural and technological factors that may affect the channel selection.
  7. Nature of the goods i.e. heavy, bulky etc
  8. The number of terminals
  9. Transportation cost
  10. The distance to be covered i.e. water and airs are mainly used for long distance products.
  11. Speed and urgency of the goods.
  12. The packaging requirements
  13. Availability of the channel
  14. Flexibility of the channel to be used i.e. can it be used in the interior regions?



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