Many manufactures do not sell directly to the end user. Between the manufacture and the user is usually a channel of distribution. They are essential to the success in any type of business. If you run a service business you need the supplies used that create the business, in which case you are a channel for the manufacturer or distribution of the supplies.
For instance, an HVAC company needs their air conditioners, heat units and service parts so the technicians can perform their job. The business maintains open channels for these items. Let’s face it, how would you react if the repair person fixing your air conditioner failed to have the proper parts with him or even at his shop?
On this aspect, you should agree then, that it is part of running a good business that a channel for the distribution of supplies in a service company is mandatory. Now, think about the distributions centers that handle the products for grocery stores, consumer electronics, and clothing stores. All these things are manufactured in a plant or grown on a farm for food. These businesses must get their products to their customers.
The point is distribution channels exist and are an essential part of doing business. The management of the supply chain covers a lot of ground. Once the product is produced, how does it go from the origin to the final destination? Are there several companies involved? How is the product transported? Sounds simple enough right? The logistics of getting, for example, a replacement air conditioning unit from the manufacturer to your house or to the business that sells them is quit a task.
First thing to determine is, after the need has been justified, to find the transportation mode and the cost of it. Someone will pay for each leg of the transportation, and this cost will be incorporated into the cost the end user pays. These connections make up the channels. To make them succeed requires communication and trust between each level of the distribution chain.
Many companies are trying to shorten the distribution chain by providing product directly on the internet to customers. This works when the support and maintenance can be handled remotely. If the product needs feet on the street to provide maintenance, you might be better off using a local distributor or reseller. Amazon has perfected the drop shipment of products you buy off their site. Once the order is place, Amazon tells their distributor to ship it directly to you.
Planning and execution of a supply chain with the cooperation between the channels, takes knowledge and the ability to workout minute details that can hamper the timeliness associated with shipments and deliveries. We have the knowledge and the means to help find or fix the issues you may have in your distribution channels. If you desire help in this matter feel free to contact us if you have questions because we would be glad to help.