‘Maruti Udyog sells its cars and vans through company approved retailers and covers a wide area of market’. Identify the channel adopted by Maruti and discuss in brief the other two channels also.
Maruti Udyog has adopted one level or manufacturer- retailer-consumer channel. Under this channel, the manufacturer sells to one ox more retailers who in turn sell to the ultimate consumers. Various marketing functions are performed by the producer and the retailers.
This channel is popular when the retailers are big and buy in large quantities, e.g. departmental stores, chain stores and supermarkets. This channel is often used for the distribution of consumer durables and products of high value. Automobiles, home appliances, readymade garments, shoes and perishable products are often sold through this channel. Other two channels are:
(i) Manufacturer-wholesaler-retailer-consumer (Two level channel) This is the 'traditional^ or normal channel for the distribution of consumer goods. This channel is suitable where the producer has limited finance and a narrow product line or where the wholesalers are specialised and provide strong promotional support.
Small producers and small retailers find this channel most convenient especially in case of products with widely scattered markets.
consumer (Three level channel) When the retailers are few or geographically concentrated, distribution through agents may be more economical than through wholesalers. For instance, a manufacturer may employ selling agents or brokers to sell his products to retailers. Sometimes, even the retailer is bypassed and the agent sells directly to institutional buyers like consumer cooperatives, business firms, educational institutions and government agencies or departments. This channel is commonly used to sell textiles, agricultural products, machinery and equipments, etc.