Part 29) Distribution of products

Distribution is the process of selling and delivering a product or service to customers, which is an important part of a marketing strategy with factors such as product, price, and promotion. Products and services are distributed through channels such as direct sales, e-commerce, retail outlets, and partners. The distribution strategy may include several channels, (with a separate pricing strategy for each one). In the distribution strategy, it is a common practice to employ different methods of managing channel partners. Distributing usually has a geographical element, and using different channels for different areas is a common practice. For example, partners may be used to access international markets.
Distribution channels are in two types: direct and indirect. In the direct case, the product reaches the consumer without the intermediary, but in the indirect case, the channel consists of various components such as wholesalers, distributors, and agents or retailers. Each intermediary receives the commodity from the previous one at a specified price and sells it at a higher price to the next intermediary, until it finally reaches the end consumer.

Distribution flows

In a distribution channel, there are three types of flows:
1. The flow of goods from producer to consumer
2. The financial (and money) flow from consumer to producer
3. Information flow in two ways

Distribution channel types 

Depending on which intermediary the distribution channel contains, it can be one of four cases:
1. Producer-Consumer: This type of channel is the simplest and shortest type of distribution channel, in where the producer sells his product directly to the consumer.
2. Producer-Retailer-Consumer: This type of distribution channel has a new intermediary called retailer that may be chain stores. In this type of channel, the producer is no longer directly involved in sales and has taken the pressure off his shoulders. Instead, he can oversee the distribution process from the outside.
3. Producer - Wholesaler - Retailer - Consumer: This type of channel is the most common type of distribution channel in which there are two intermediaries called retailer and wholesaler between the consumer and the producer. This type of distribution channel is suitable for manufacturers with low financial strength and a narrower product range.
4. Producer-Agent-Wholesaler-Retailer-Consumer: This type of distribution channel is the longest type of channel in which three intermediaries are involved; this type of channel is suitable for wider distribution with a variety of products and presence in various markets.


Capillary distribution

Capillary distribution is a distribution system that is carried out through distribution channels similar to the capillaries and veins of the human body.

Type of distribution 

1- Cold distribution: In the first step, a person visits the store as a visitor and starts visiting and ordering with his own tools. Then, upon sending the request to the distribution company, the distribution agent delivers the store's order. 

2- Hot distribution: In this type of distribution, the distribution agent and visitor are one person; the visitor puts the products in his car; He then visits the stores with his tools and starts ordering registration; once the order has been registered, he delivers the required products to the store at the same time. 


Advantages of capillary distribution: 

1. Gathering accurate and up-to-date information from the market;
2. More market coverage;
3. Broader customer relationships;
4. Reducing the risk of customer loss;
5. Reduction of losing money;
6. Increasing the bargaining power of the company;
7. Reducing the likelihood of forming new competitors;
8. Reducing the possibility under the sale price;
9. Permanent cash flow; and
10. Possibility of giving more authority to the branches


Domestic distribution :

The New World Institute has made it possible for manufacturing and service companies to introduce and market their goods and services domestically. Domestic distribution will boost corporate business and turnover than before by using the science of market analysis and managing the supply of goods and services in all parts of the cities and by employing experienced manpower to provide better corporate goods and services,
New World Institute distributes any goods and services available nationwide at the best quality and timely manner using the domestic capillary management system.

International distribution:

International distribution of goods and services consists of all management measures to analyze the destination market and to supply goods and services at the best quality and quantity in the destination country and to obtain the necessary authorization from the relevant authorities in the countries of origin and destination.
The New World institute performs international distribution of all goods and services salable in other countries, especially neighboring countries such as Iraq, Turkey, Qatar, UAE, Oman, Kuwait, Azerbaijan, Armenia, Georgia, Russia, EU countries, North America, South America, etc., using up-to-date knowledge of the international market and accurate observation of the exchange rates of countries.
The New World Institute is ready to make contracts for obtaining licenses and distributing goods and services internationally to facilitate distribution for manufacturing and service companies