What is a Distribution Channel?

The path a product or service takes from its creation to the person who will use it. In marketing, distribution channels are typically broken into business-to-business (B2B) and business-to-consumer (B2C). B2B deals with the interactions between companies to create products, while B2C focuses on how products get to the people who use them. For example, a business may sell directly to a customer, or it may sell to a retailer, who in turn sells to the end user.


An example of a distribution channel is the journey of a product from the manufacturer to the consumer through various intermediaries:

Let’s consider a clothing manufacturer that produces t-shirts. The distribution channel for these t-shirts might include the following steps:

  1. Manufacturer: The clothing manufacturer produces the t-shirts in a factory.
  2. Wholesaler: The manufacturer sells the t-shirts in bulk to a wholesaler, who purchases large quantities of goods from multiple manufacturers and then sells them to retailers.
  3. Retailer: The wholesaler sells the t-shirts to retailers, such as department stores, boutiques, or online shops, where consumers can purchase them.
  4. Consumer: The end consumer purchases the t-shirt from the retailer, in-store or online, and wears it.

In this example, the distribution channel consists of multiple intermediaries who help transport the product from the manufacturer to the consumer. Each intermediary plays a specific role in the distribution process, adding value and facilitating the movement of the product through the supply chain.

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