What Is a Distribution Center and Distribution System

In this article, we would be covering in depth as to the meanings related to Distribution Center and a Distribution System.

Exporting and Importing can often be an extremely complicated and mundane process as there are so many rules, regulations as well as countless  number of procedures to adhere to. This, many a times, may require to prepare and submit documents for import and export. Usually, freight forwarders would prepare it  for us, but it is also good to know for ourselves as to how to complete the relevant documents by understanding what the terms mean.

As such, in our new article series titled “Export Terms”, we would  introduce you to all the various terms used in the international trade, be it through air, land or sea freight. We would roll out one related article on a regular basis, which would help you to get a comprehensive understanding as to the document preparation for the purpose of doing trade internationally

What is a Distribution Center

A distribution center is actually different from a warehouse. In fact, it is usually smaller in size as compared to a warehouse because the goods  are only kept there for a much shorter period of time. The only purpose for the goods to be at the center is so that they could be redistributed to the named destination from the center. Usually, the distribution centers are placed at strategic locations nearest to the customers of the particular region. Customers can also have the choice to collect their goods from the distribution center.

What is a Distribution System

A distribution system is commonly referred to a process that consists of steps, methods and facilities that help to transport the goods from the supplier all the way to the end customer. As such, the distribution center as mentioned above is actually part of the distribution system.

For example, a retail company may have a distribution center that transport the cotton material from the plantations to the factory for the manufacturing of the apparel for sale, for example. After which, the goods travel from the factory to the warehouse, before it gets sent to the distribution center upon demand. If the goods need to travel to another country, the goods would leave the warehouse and be shipped to the destination center of the other country either by air, sea, land or even rail freight.

Upon request or demand, the goods would  be sent to the various retail outlets all across the country.As such, the entire process of transporting the goods from the plantation all the way to end customer is referred to as the distribution system.


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Goods being transported have to go through the distribution system


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