Distribution System: Definition & Types

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  • 0:05 Distribution Systems Defined
  • 1:27 Types
  • 2:43 Lesson Summary
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Lesson Transcript
Instructor: James Carnrite

James has a masters degree in IT Management.

In this lesson about distribution systems we will grasp how the collaboration of various procedures is linked together to aid supply of products and services to meet demand. An ensuing quiz will test your knowledge.

Distribution Systems Defined

Distribution systems can be defined as the sequential flow of procedures, systems, and activities which are designed and linked to facilitate and monitor the movement of goods and services from the source to the consumer. Essentially, distribution is about making products and services available to the end users when and where they need them.

Global Supply Image

Often times, you might hear the term channel of distribution or a marketing channel in reference to the distribution systems. These two terms relate to a group of organizations or individuals who have an impact on the flow of products and services from the source production and the end consumer.

To reiterate, distribution systems refer to making products and services available to the customer base when they are in need and where they can be used. Below are some of the key attributes associated with distribution systems and the benefits they offer:

  • Time: when the consumer wants to obtain the product or service.
  • Place: the place attribute is where the consumer wants to obtain the product or service.
  • Control: consumer ownership of the product or service.
  • Method: the specifics to the distribution channel; ex. a private label grocery product being manufactured by different producers.

Critical to the design of the distribution system, each attribute has a role and responsibility in the end-to-end system and shares common goals, such as profit and growth, which are attained with a unified process.

Types of Distribution Systems

Within a distribution system we can find multiple channels to enable distribution. The following list and examples will provide some insight to some of the common channels we see around us.

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