One of the key elements of having a successful business is having a strong distribution channel. This is particularly true in the case of Retail or FMCG business.
Distribution channel plays a crucial role in movement of products or services from one point to another and helps in bridging the gap between the manufacturer and the end user. A successful distribution channel is also a testimony of the fact that the requisite goods or services are available at the right time and at the right place in adequate quantity so that it can be supplied to the end user.
One of the important aspects of having a successful distribution channel is to enable the business reach a wider audience by ensuring that products and services are readily available to the end user spread across different demographics and geographical boundaries.
Efficient distribution channels ensure that the products or services are delivered to the end user promptly especially in critical industries where product availability and speed are key competitive factors such as e-commerce or consumer goods.
Distribution channels often provide necessary customer support such as after sales service, product return and exchanges etc. Some of the other advantages of having a strong distribution channel in a business is providing visibility to the brand through strategic partnerships between retailers, distributors and online platforms as well as it serves as a medium to gain valuable insights on consumer buying preferences and understanding market trends. These metrics could particularly be useful for designing products and services as per the changing taste of the end user or consumer.
Distribution channels also help in understanding the legal and compliance challenges in a given market which could be hugely different from the parent market. This is particularly useful when a business is in expansion mode especially in the international domain where the legal and regulatory compliances could be different for different countries or even trade specific zones.
Thus it can be said that having a strong distribution channel not only helps in market penetration and business expansion but also helps in taking informed decisions by contributing through several other factors and variables.