Direct distribution
In direct distribution, a product is delivered directly to the consumer by the manufacturer or supplier itself, without the intervention of other sales channels such as third-party stores or web stores. Because business is done directly with the customer, there are no middlemen involved who also pocket a share of the margin. Also, direct distribution requires less (or different) logistics.
The opposite of direct distribution is indirect distribution.
Some examples of companies that work entirely or largely with direct distribution are:
- IKEA (selling its own products in its well-known own stores)
- Apple and Dell (computer manufacturers who sell a lot through their own web shops and stores)
- Shell (oil company with a network of its own service stations).
Not infrequently, multiple proprietary sales channels are used for direct distribution, such as a combination of a web shop with its own physical stores. Indirect distribution, sales through third-party channels, is also used. Combining distribution channels is called dual distribution or multi-channel distribution.
