Page 196 - DMGT509_RURAL MARKETING

Unit 10: Distribution Strategies for Rural Market

In the second method there can be a number of intermediaries as given below: Notes

Manufacturer Wholesalers Retailers

Figure 10.1: Bata Selling Products through Personal Selling

In the indirect method the simple method starts from manufacturers who sell the product to
wholesaler, who in turn sells it to retailer, for sale to the ultimate customer. At each step, some
amount of money as profit is given, which adds to the selling price of the product to the
customer. In most cases the manufacturer follows the set pattern of product distribution as per
trade practices, or how the competitors are distributing their products. However, blindly
following competition is not the answer, as competitors may be having different scales of
production or any other basic difference with the firm. Innovations in distribution methods are
taking place and firms should take advantage of the new methods.

Let us examine the two broad categories of products and their presently accepted distribution
patterns.

10.1 Distribution Patterns for Consumer and Industrial Goods

In case of sale of raw materials and components the manufacturers sell through a distributor
network, the size of which is finalized taking the geographic area, which needs to be covered, by
the manufacturer.
Industrial Goods

Manufacturer Distributor Customer

As can be seen, in industrial goods, the sale is made either directly to the customer or through a
distributor. Capital goods sale is usually made directly to the customer, because of the following
reasons.
1. Technicalities have to be explained to the customer, which are best done by the
manufacturer.

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