What is intensive, selective and exclusive distribution

We are currently exploring the topic of distribution. Yesterday, we covered the meanings behind the terms, distribution intermediary, distribution mix as well as  reverse distribution, which you could read over here. In the previous article, we covered the meaning behind a distribution center and system.

In today’s article, we would be analysing the meanings behind distribution networks, selective, exclusive and intensive distribution.

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 Distribution Network

This is pretty straightforward. A distribution network basically refers to a an entire chain or system of parties ranging from the supplier of the raw materials, to the manufacturer, the wholesaler, distributor retailer, consumer and all the other relevant intermediaries that are in between. It is critical for a business to have a proper distribution network, so that goods can reach the customer upon demand at the fastest time in its best condition.

Many multinational corporations around the world try to own as many stages of the distribution as they possibly can. This is so as to have control over the production and distribution of the company’s products. Some of these corporations are McDonald’s, Zara and Google.

What is Selective Distribution

Moving on, selective distribution is commonly referred to as a type of product distribution that is the middle of the road type of distribution when compared to intensive distribution as well as exclusive distribution. Intensive distribution is an arrangement where the company tries to sell its products and services as many places as possible, so that consumers can buy it from any place. Example might be bread, drinks and other staples.

Exclusive distribution on the other hand is when  companies agree to partner with each other where they become the exclusive sellers and distributors of the product. As such, other parties are not allowed to sell he exclusive item

Therefore, selective distribution lies in the middle, where the items are only available at a few places in a specific area. However, its availability is not as rampant as that of intensive distribution

Which is the best type of distribution for your business? Intensive, exclusive or selective?


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