What is a Distribution Channel?

• Direct Distribution channel = Manufacturer → End consumer. E.g. An artist selling their work online directly to the end consumers.
• Indirect Distribution channel: Manufacturer → Middleman/Middlemen → End consumer.

The middlemen can be the manufacturer’s representative, a wholesaler or a distributor, a dealer, a retailer, a consultant, a catalog, or the internet. E.g. A perfume maker using both a retailer and Amazon to sell their goods to the end customers.

Distribution channels are crucial to businesses selling products because they allow a smooth delivery of goods to consumers. Once you have created the best product on the market, you need to make sure it gets to the right people through the right channel.

Each type of channel has its own advantages and disadvantages and usually the larger the organization, the more complex channels it can afford. Distribution channels can also evolve over time depending on a company’s objectives and can become more complex powered by overall business growth.