What is meant by’indirect channels of distribution? Explain any two methods of indirect channels of distribution.
Indirect channels When a manufacturer takes help of one or more middlemen to move goods from production place to the consumption place, the distribution channel is called indirect channel.
Following are the types of indirect channel:
(i) One level channel In this method, an intermediary is used. Here, manufacturer sells the goods directly to the retailer instead of selling it to agents or wholesalers. This method is used for expensive products.
Two level channel In this method, manufacturer sells the material to the wholesaler, wholesaler to the retailer and then retailer to the consumer.
Here, wholesaler after purchasing material in large quantity from the manufacturer sells in small quantity to the retailer. Then retailers make the products available to consumers. This medium is mainly used to sell consumer non-durable goods like soap, tea, salt, sugar, ghee, etc.
