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The owner can give some members of the channel some privileges or has the opportunity to exert economic pressure on them to coerce them. At the first manufacturer is the owner of both wholesale and retail businesses.
In the second case, the retailer has its suppliers.
Similar distribution channels are called horizontal .
We list the levels of the distribution channels (see Figure 10.1). Zero (that is, without intermediaries), or a direct marketing channel.
Here is a summary: Nature of the product Perishable/fragile? Complex products are often sold by specialist distributors or agents Customised?
A direct distribution approach often works best for a product that the end consumer wants providing to a distinct specification Type of product – e.g. Marketing objectives – revenue or profit maximisation?
By channel level is understood as the intermediary performing the work, which ensures the approach of the product and the ownership of the product to the final consumer.
Channel Length determines the number of intermediate levels between the manufacturer and the consumer.
Traditional channels are distribution channels of various lengths, consisting of an independent producer and one or more independent intermediaries - channel members.
Channel member is a separate company that seeks to maximize profits, which can lead to a reduction in the overall profitability of the system, since no member of the distribution channel has complete (sufficient) control over the activities of other members.