- Provide Distribution Efficiency
- Provide Salesmanship
- Help in Price Mechanism
- Look After a Part of Physical Distribution and Financing
- Provide Market Intelligence
- Assist in Merchandising
- Provide Market Intelligence
- Act as Change Agents and Generate Demand
- Take Care of the Flows Involved in Distribution
Provide Distribution Efficiency In the first place, the channels bring together the manufacturer and the user in an economic manner and thereby provide distribution efficiency to the manufacturer.
Minimize the number of contacts needed for reaching consumers: In most cases, it will be impractical for a manufacturing firm to sell its entire production directly to the consumers. Resource constraint is the first hurdle in this regard. Even assuming that the required resources can be found, the question arises whether it will be advantageous for the firm to sell its products directly and all by itself, totally avoiding external. Marketing channels analysis shows that in most cases, using external marketing channels/intermediaries is more advantageous to the firm than performing the distribution function all by itself. When channels are dispensed with, the numbers of contacts a manufacturer will have to establish for reaching out to the consumers are far too many; Channels minimize the number of contacts.
Break the bulk and cater to tiny requirements: Channels break the bulk and meet the small-size needs of individual consumers.
Supply products in suitable assortments: Channels also combine products and components manufactured by different firms and offer them in assortments that are convenient to users. The users normally need an assortment of items. They will shop at only those outlets, which supply such assortments. But, a manufacturer cannot meet the need for such assortments, since it will not be feasible for him to take up distribution of other products required by the customers. The channels thus render the vital service of assembling the products of different manufacturers and offering them to customers in suitable assortments. In other words, the channels help in ‘matching segments of supply with segments of demand’.
