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Home→The Westburn Dictionary of Marketing→C→channel (of distribution)

channel (of distribution)

Definition:
'The structure of intra-company organization units and extra-company agents and dealers, wholesale and retail, through which a commodity, product or service is marketed' (American Marketing Association definition). In other words, a channel consists of all those stages and organizations through which a product must pass between its point of production and consumption. At its simplest, this may be a single, direct transaction between producers and consumer, e.g. DIRECT MAIL SELLING, or the sale of produce at the farm gate. On the other hand, where production is highly concentrated and consumers are widely diffused, a number of different channels may develop and coexist with a variety of agents, distributors, wholesalers, retailers and other intermediaries acting as the channel through which goods will flow from producer to consumer. At the macro level in the economy, a channel of distribution may be described as a sub-system that serves manufacturers and consumers in bridging the gap between production and consumption. At the micro level the channel is a set of enterprises who have formed a symbiotic relationship in economic and social agreements as a means of increasing their social assets, and making products and services available for consumption.

Cross-References:
[distribution channel, functions of] [direct mail]

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© Westburn Publishers Ltd 2002, The Westburn Dictionary of Marketing edited by Michael J Baker, ISBN 978-0-946433-01-8. www.themarketingdictionary.com. Entry: [A. J. Brown and Michael J. Baker], [1998].