Question

Describe the types of channel intermediaries.

Answer 1

There are 4 types of channel intermediaries.

(i) Agents - These are individuals or organisations which act as middlemen between a producer and consumer. They take possession of goods.without taking ownership of it from the producer to forward it into the distribution channel. They work on a commission of the value of goods they take possession of.

(ii) Wholesalers -They are the ones who purchase the goods from manufacturers in bulk and sell to the lower intermediaries like retailers.They earn a part of the markup as commission on sales.

(iii) Distributors- They do take title of goods like wholesellers, but they held a close relationship with the manufactuer by being dedicated to a single company in a single segment. For example, a distributors of pumps will adhere to a single manufacturer ant not sell competitive products.

(iv) Retailers - They purchase the goods from wholesalers or distributors and in some cases, from the company itself, and sell directly to the end consumer. They are of various sizes and work of different scales. Retailers can range from neighbourhood store to specialised sellers to huge departmental stores, where end users visit to purchaase the product.