Define the term 'channel of distribution'.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2017). The mark or mark type is shown in brackets.

1. [2] It is the chain of intermediaries a product passes through (1) from producer to consumer. (1)
2. [1] A partial definition such as 'the way a business distributes its products' or 'method used by a business to get products to customers' merits 1 mark.
3. [3] Answers may include: cost of different distribution channels e.g. direct selling involves shipping costs and requires the manufacturer to hold inventory; using intermediaries means reduced profits for the manufacturer; efficiency of distribution channel; which will reach the customer the quickest and at the lowest cost to the manufacturer; which channel gives the manufacturer the control they require over how the product is presented to the customer; type of product – industrial products tend to be sold more directly than consumer goods, perishable direct to retailers; the nature of the chosen market - if it is large and dispersed, intermediaries may well be needed; level of service required or demanded by customers – so some products will not be sold via internet (e.g. bespoke products); technical complexity of the product – may be direct selling, e.g. computers; number of customers – if high value product and few customers, direct selling might be used (luxury yacht).
4. NOTE: Some answers refer to methods of transportation but not specific intermediaries. The question is 'channel of distribution' so methods of transportation only cannot gain marks.