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Business organization – Management and control Essay Sample

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Business organization – Management and control Essay Sample

Distribution is the movement of a good or service from the source to the final customer, consumer, or user. This process is made through a distribution channel for example wholesalers and retailers. The purpose of a distribution channel is to supply a link between production and consumption. There are 2 types of distribution channels these are indirect and direct. An indirect distribution channel relies on middle men to perform most if not all of its product handling functions. This is known as wholesale distribution. Businesses that have indirect distribution channels have to set up relationships with third-party selling systems. An indirect distribution channel would look a little something like is: Producer-Wholesaler-Retailer-Consumer. An example of a business that does this would be Pretty Little Thing.

A direct distribution channel is both organized and managed by the business. These businesses will have their own logistics teams transport vehicles warehouses and driving staff. A direct channel will also have to worry about things like marketing and packaging as well as making the product and selling it on. This is very expensive to start up therefore sometimes this can require a large investment but it is worth it because the company would be saving money in the long run. Direct distribution also allows the business to be closer to their customers. A direct distribution channel would look a little something like is: Producer- Consumer. An example of a business that does this would be Asda.

Asda Pretty Little Thing Type of Distribution method used Tesco use a direct distribution channel and deliver its produce straight to the consumer on vans that are apart of Asda along with the drivers that are employees of Asda and therefore belong to them Pretty Little Thing use an indirect distribution channel.

Transportation used Asda use large vans to deliver produce. They would have more means of transport than a retail store because a fair amount of the produce they sell is frozen and this will need to get to the consumer as soon as possible. This may suggest using air method as all food has an expiry date or a preferred time that it can be at room temperature for if it is meant to be in a freezer. Pretty little thing use Hermes delivery company to deliver the goods hence the high delivery cost which is added on to the bull at the end just before checkout. With most clothing retailers, most products are sourced overseas despite the fact that Pretty Little thing is a UK based company therefore the wait time for the product to be delivered will be extended

Tesco is a British multinational grocery with a lot of revenue. Tesco is also a public limited company.. Tesco is also the largest retailer in the world and this is based on profits. Tesco’s main objective is to earn a customer loyalty for a lifetime. For example Tesco’s sell a vast range of milk in different types and sizing to make their customers happy. The different types of milk have different requirements in order to keep it fresh. Milk is issued a limited amount of time by the farmer, this is usually around 24-48 hours as milk expires quickly, yet still when the milk arrives in the store it is fresh and ready for customers use. This must mean that the transport being used to get the milk from the farmers to the store includes refrigerators to keep the milk fresh for the customers once it is on the shelves of the store

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