Channel activities may be carried out by the marketer or the marketer may seek specialist organizations to assist with certain functions.
Classification of specialist organizations into two broad categories
Resellers
Resellers also known as intermediaries, distributors or dealers, generally purchase or take ownership of products from the marketing company with the intention of selling to others. If a marketer utilizes multiple resellers within its distribution channel strategy the collection of resellers is termed a Reseller Network. These organizations can be classified into several sub-categories as discussed below
- Retailers: Organizations that sell products directly to final consumers.
- Wholesalers: Organizations that purchase products from suppliers, such as manufacturers or other wholesalers, and in turn sell these to other resellers, such as retailers or other wholesalers.
- Industrial Distributors: Firms that work mainly in the business-to-business market selling products obtained from industrial suppliers
Specialty Service Firms
These are organizations that provide additional services to help with the exchange of products but generally do not purchase the product (i.e., do not take ownership of the product). The specialty services firms can be categorized as under
- Agents and Brokers: Organizations that primarily work to bring suppliers and buyers together in exchange for a fee. Example – C&F Agents
- Distribution Service Firms: Offer services aiding in the movement of products such as assistance with transportation, storage, and order processing.
- Others; This category includes firms that provide additional services to aid in the distribution process such as insurance companies and firms offering transportation routing assistance.