Companies often pay too little attention to their distribution channels, sometimes with damaging results. In contrast, many companies have used imaginative distribution systems to gain a competitive advantage. FedEx’s creative and imposing distribution system made it a leader in express delivery. Enterprise revolutionized the car-rental business by setting up off-airport rental offices. And Apple turned the retail music business on its head by selling music for the iPod via the Internet on iTunes.
Verb vodka will be distributed to liquor stores and clubs via truck and cargo plane depending on the regional demand. We will not own any of these vehicles we will contract out companies to handle these duties. This will help our cost effectiveness and overall efficiency in regards to timely turn around of products.
Distribution channel decisions often involve long-term commitments to other firms. For example, companies such as Ford, HP, or McDonald’s can easily change their advertising, pricing, or promotion programs. They can scrap old products and introduce new ones as market tastes demand. But when they set up distribution channels through contracts with franchisees, independent dealers, or large retailers, they cannot readily replace these channels with company-owned stores or Web sites if conditions change. Therefore, management must design its channels carefully, with an eye on tomorrow’s likely selling environment as well as today’s.
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