Distribution
The storing and moving of products to customers, often through intermediaries such as wholesalers and retailers, and it also includes transportation, which involves the physical movement of goods.
What is distribution?
This company/person bridges the gap between producers and retailers by buying in large quantities and selling in smaller, more convenient lots to the retailer.
What is the wholesaler?
Traders providing goods and services directly to the consumer.
What is retailers?
The holder of this card can use it to make purchases up to a set amount without paying cash.
What is credit card?
The percentage profit which is added to the cost price by a trader to establish the selling price.
What is Mark-up?
The route used to physically get the product from the manufacturer to the actual buyer of that product.
What is distribution channel?
Give two services offered by the wholesaler for the producer.
What is:
1. Reduces transport cost
2. Advises the producer of current market trends
3. Finishes goods by grading, packing and branding.
4. Makes mass production possible by ordering in large quantities and therefore reducing production cost.
The position of retailers in the distribution channel.
What is
They are positioned either between producers and consumers or between wholesalers and consumers.
Using the internet to purchase goods is very popular. Some of these sites are eBay. Amazon, etc.
What is E-commerce?
Formulas for calculating Mark-up and Profit Margin.
What is:
(Selling Price - Cost Price) / Cost Price X 100
What is:
(Selling Price - Cost Price) / Selling Price X 100
Top two reasons why retailers and consumers would buy direct from the manufacturer.
What is:
•Sufficient capital to purchase
•Better trade discounts
Three functions of the wholesaler.
What is acting as an intermediary, bulk breaking, warehousing, taking on risk, and offering credit?
Function: Retailers buy in large quantities and sell in single items to consumers.
Function: Retailers’ expert knowledge and experience enable them to advise and inform customers on the quality and suitability of products
Function: The retailer holds stocks which the consumer can purchase locally in small, convenient quantities
What is Breaking of bulk?
What is Information and Advice?
What is Stocks?
This is the last step in the sales process.
What is retailing?
Nathan, Khai and Miracle bought 500 chairs for their furniture store. They each cost $40.00. They resold them for $60.00 each. What was the markup rate on the chairs? How much profit did they make from each chair?
What is:
Mark-Up: Selling Price–Cost Price/Cost Price X 100
$60 - $40 / $40 X 100= 20/40 X 100= 50%
Profit: $60.00 - $40.00= $20.00
Company or person responsible for making the product.
The company holding large stocks and ‘breaking bulk’ into smaller packs for retailers.
The company that sells the product in convenient quantities to the final buyer.
The final purchasers of the product.
What is the manufacturer?
What is the wholesaler?
What is the retailer?
What is the consumer?
Give four services offered by the wholesaler for the retailer.
What is:
1.Offers choice of products from many producers.
2. Supplies small quantities to suit retailer’s needs.
3. Locally situated providing quick access to goods, and open until late in the evening.
4. Advises on latest trend and best products to buy.
5.Pre-packs goods ready for the retailers’ shelves (graded, labelled, priced and weighted goods)
Includes convenient location, price, promotions, special offers, brand reputation, attractiveness of space, and efficient delivery systems.
What are factors of competition among retailers?
Describe what a franchise is and provide three examples.
What is an agreement that allows the entrepreneur to use the name of a well-known company and the exclusive right to market its products within a specified area. Some examples are Wendy's, McDonalds, KFC.
Werlie and Azaria run a successful beauty supply shop. They bought 25 bags of 100% Real Human Hair for $600. If they sold them at a 12% markup, what was the selling price of one bag of hair?
What is:
Cost Price of 1 bag of hair: $600/25= $24.00
Selling Price: Cost Price + Mark Up
$24.00 + 12%= $26.88
The four distribution channels.
What is
Producer to Wholesaler to Retailer to Consumer
Producer to Retailer to Consumer
Producer to Wholesaler to Consumer
Producer to Consumer
Name and describe the three types of wholesalers.
What is:
General Wholesaler: operates from large warehouses sited for convenient access from many local towns.
Cash and Carry Wholesaler: do not allow credit and do not deliver goods. Retailers come to the warehouses, select goods, pay for them, and provide their own transport.
Specialist wholesaler: allow credit, provides transport, and sells one line of item. It is also set like a warehouse and it is not self-service.
Name three trends impacting demand at the international level.
What is sustainability and eco-friendly products, contactless payment options, and ease and convenience?
Name at least two advantages and disadvantages of franchising.
What is access to an established company's brand name, management knowledge, processes and procedures, and financial toolbox?
Tyreece, Rosie and Paris bought 15 microphones from Bryan (they own a music store) for $630 dollars. They sold each one for $46.00. What is the profit on one microphone? What was the mark up rate?
What is:
Profit for one microphone: $630/15=$42 $46-$42= $4.00
Mark Up: Selling Price–Cost Price/Cost Price X 100
$46.00-$42.00/$42.00 X 100= 9.52%