Question

question 12
what is the structure of a channel 2 distribution system?

a global distribution network where producers use multiple agents and franchises across countries
a direct distribution system where producers sell straight to consumers
a system where products move from producer -> retailer -> consumer
a system where goods flow from producer -> wholesaler -> retailer -> consumer

Explanation:

Define distribution channel levels

In marketing and supply chain management, distribution channels are categorized by the number of intermediaries between the producer and the final consumer:

• Channel 1 (Direct Channel): Producer $

ightarrow$ Consumer (0 intermediaries).

• Channel 2 (Indirect Channel): Producer $

ightarrow$ Retailer $
ightarrow$ Consumer (1 intermediary).

• Channel 3 (Indirect Channel): Producer $

ightarrow$ Wholesaler $
ightarrow$ Retailer $
ightarrow$ Consumer (2 intermediaries).

Identify the structure of Channel 2

A Channel 2 distribution system contains exactly one intermediary level, which is typically a retailer. Therefore, the flow of goods moves directly from the producer to the retailer, who then sells to the final consumer.

Evaluate the given options

• Option 1: Describes a complex global network with multiple agents and franchises. This does not represent the standard definition of a Channel 2 system.
• Option 2: Describes a direct distribution system (Channel 1).
• Option 3: Describes a system where products move from producer $

ightarrow$ retailer $
ightarrow$ consumer. This matches the definition of a Channel 2 system.

• Option 4: Describes a Channel 3 system with two intermediaries (wholesaler and retailer).

Answer:

• (A) A global distribution network where producers use multiple agents and franchises across countries
• (B) A direct distribution system where producers sell straight to consumers
• (C) A system where products move from producer ➔ retailer ➔ consumer (Correct answer)
• (D) A system where goods flow from producer ➔ wholesaler ➔ retailer ➔ consumer