5 Types of Distribution Strategies for a Company

Getting an order is one thing, delivering the order is a totally different thing. Since you need repeat customers, you must make your delivery as easy and seamless as possible to impress your customer so they can place new orders.

If you make a mistake in your distribution, your customers will migrate to your competitors.

That’s why you need an efficient distribution channel so you can have happy and satisfied customers.

Here are the top 5 distribution strategies you can choose from:

1. Direct Distribution

Just as the name implies, direct distribution means you directly sell and send your products to your customers. There are many ways of doing this. A good example is to have an e-commerce website where your customers can place their orders then you deliver the products to them.

Other methods of placing orders are phone orders, email orders, or catalog orders. The most important thing here is that you deal with the consumers directly.

2. Indirect Distribution

Under indirect distribution, you’ll not have to organize the delivery of the goods to your consumers. You’ll have to engage “middlemen” to carry out the delivery.

These middlemen come in the form of intermediaries who will deal with all the logistics involving the movement of your products. You can go over a list of distribution companies and pick the most reliable one. The company will charge you a fee for delivering your goods.

3. Intensive Distribution

The intensive distribution strategy involves opening many retail locations and stocking them with your goods. This way, your agents in these stores will be selling directly to customers. This distribution strategy requires a huge investment that only big companies can manage.

For example, you’ll have to pay rent, electricity, etc. for the various stores you have, and also have employees to man the retail locations.

If you don’t want to rent a whole shop, you can rent spaces in groceries, gas stations, and also install vending machines.

4. Exclusive Distribution

Exclusive distribution is where you can make a deal with some retailers so you can sell your products through their storefronts. You can also choose to sell your goods through your own branded stores. This distribution strategy works best for exclusive and highly coveted items.

For example, if you need to buy a Lamborghini, you have to go physically to their stores. You can’t get it anywhere else.

5. Selective Distribution

This distribution strategy lies somewhere between exclusive and intensive distribution strategies. In selective distribution, the products are sold in many locations, but not as many as in intensive distribution.

For example, you can sell your products at your store as well as in other department stores. This will help you reach as many customers as possible.

Conclusion

All the above distribution strategies involve some costs. So in choosing one, you must consider the one that will not eat too much into your profits.

The choice of a distribution method will depend on the size of your company and the type of product(s) you are dealing with. It will also depend on your warehouse capabilities and whether you can handle the logistics.