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Unit 10: International Logistics and Distribution Channels

manufacturer’s sales intermediary (middleman). As such, the sales intermediary is just another Notes
local or domestic channel for the manufacturer because there are no dealings abroad with a
foreign firm. By exporting through an independent local middleman, the manufacturer has no
need to set up an international department.
There are several advantages to be gained by employing an indirect domestic channel.

Example: The channel is simple and inexpensive. The manufacturer incurs no start up
cost for the channel and is relieved of the responsibility of physically moving goods overseas.
Because the intermediary very likely represents separate clients who can help share distribution
costs, the costs on moving the goods are further reduced.

10.3.1 Types of intermediaries: direct channel

There are several types of intermediaries associated with the direct and indirect channels as
shown in Figure 10.1. This figure compares two channels and lists the various types of domestic
and foreign intermediaries.

Figure 10.1: International Channels of Distribution

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