Definition: Direct Distribution is the approach to distribution of products in which the distribution channels are organized and managed by the manufacturer itself. In a direct distribution setting, the company bears 100 percent of the financial risks. Generally, direct channels have the shortest distance and are the simplest distribution channel. Direct Distribution Channels Direct channels tend to be expensive to establish , sometimes demanding substantial capital investment in warehouses, logistics, transport vehicles, and driving staff. Direct Distribution. This can be done directly by the producer or service provider, or using indirect channels with distributors or intermediaries.The other three elements of the marketing mix are product, pricing, and promotion. It may include a selling platform such as an e-commerce store, but as long as the length of the distribution channel is minimal the process will be considered as a direct distribution process. Types of Distribution Channels – Direct and Indirect Channels of Distribution with Examples A manufacturer may plan to sell his/her products either directly or indirectly to the customers. Direct distribution leads to lower prices for the consumer. Unfortunately, this is a very narrow view of the selling process. Direct selling eliminates several intermediaries involved in product distribution, such as the regional distribution center and wholesaler. Direct Distribution Strategy. Direct distribution is exactly what it sounds like, the manufacturer directly selling to the consumer. Since the internet, a lot of things have been made easier, and direct channels of distribution … Here the manufacturing company requires its own logistics teams, warehouses transport facilities, etc. Selling directly to consumers requires impeccable documentation and tax records due to the increased likelihood of an audit. After its components are in place, however, a direct channel is likely to be more economical and efficient in operation than an indirect channel. Distribution channels may be direct, from the producer directly to the consumer. As a result, consumers that purchase a product directly from the wholesaler or manufacturer will pay much less for a product. Since the product is only marked up once, the selling price is much cheaper. Distribution (or place) is one of the four elements of the marketing mix.Distribution is the process of making a product or service available for the consumer or business user who needs it. Instead, products go from the manufacturer to the direct sales company, then to the distributor or rep, and finally to the consumer. This way of distribution allows consumers to buy directly from the manufacturer.
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