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Distribution refers to the methods that you can implement in order to allow your customers to access or receive their purchases. There are a number of options to choose from to distribute your products to customers including:

Direct distribution

Your business sells its products directly to customers through channels such as retail stores, markets, the internet, direct mail orders, door to door sales and catalogues.

Indirect distribution

Your business sells its product through some form of middleman who sells the product on behalf of the business. This may be through retailers (such as department stores), wholesalers, agents (such as a real-estate agent) or a distributor.

The distribution method you choose for your product will be dependant on a number of factors such as cost and your target market. Each distribution method has positive and negative aspects so a thorough cost-benefit analysis will go a long way in assisting you to make an informed decision.

Generally wherever possible it is good to be able to sell directly to customers. This is because when you introduce a third party to the process, you are taking away some of your control over the customer experience. If your agent does a poor job of distributing your product it can inflict a negative impact on your business. Indirect distribution may also come with additional costs at either a fixed or performance based rate.

However, for some small or new businesses, this may be the only cost-effective way to get into the marketplace as setting up your own process to directly sell to customers can result in high start up costs with significant associated risk.