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E-commerce distribution networks have changed the way businesses sell, package and ship consumer goods. Because of this, more pressure is on IT teams to help online retailers fulfill their orders. Ele
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Product Distribution Strategy
September 6, 2019
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What is an E-commerce Distribution Network?

E-commerce distribution networks have changed the way businesses sell, package and ship consumer goods. Because of this, more pressure is on IT teams to help online retailers fulfill their orders. Electronic commerce, also known as E-commerce, is a popular emerging distribution channel. Manufacturers create a distribution path so that they can move the product out of the factory. Then, it’s onto the physical location where a price tag is added before it is moved to the shelf, ready for the customer to buy. The right team for you will work alongside you to develop a complete shipping, logistics, and supply chain technology solution that suits your business.

What is an e-commerce distribution network? This type of channel is being used both for B2B and B2C activities and has quickly changed the marketing landscape for businesses where goods can be sold to their customers without any need for face to face personal interaction. By using e-commerce distribution channels, both businesses and customers can benefit. If you’re looking for entry into the global marketplace, this could be it. 

What is an E-commerce Distribution Network?

The e-commerce distribution network has been expanding thanks to constant advancement in technology and the ease of internet access. A distribution network is the route decided on and designed by the company that will eventually deliver its products or services to their audience. The route can be short or long depending. For example, a quick route may be a quick exchange between the company and the customer, while a longer route may include a number of intermediaries such as wholesalers and distributors.

There are numerous benefits for a business that decides to do this. Businesses are able to lower the sales prices and attract more customers thanks to the reduced operating expenses that come with having very few to no overheads. The success or failure of an e-commerce distribution network will depend on their offline and online features. 

Important online features include:

  • System quality
  • Information quality
  • Service quality
  • User-friendliness of a system 

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There should be detailed product information, such as accuracy, timeliness, and more. Excellent customer service and appropriate information must be maintained and provided at all times. 

In order to create an effective e-commerce distribution network, the following must happen:

  • Create a base - In addition to traditional wholesalers and retailers, companies may benefit from asking big buyers if they want to become resellers for the brand
  • The relationship must be profitable on both sides
  • Communication is key
  • Aim to build strong relationships
  • Gather feedback and act on it

E-commerce distribution networks make products available when, where, and in which quantities the customer wants. They are also responsible for:

  • Logistics and Physical Distribution
  • Facilitation - channels might provide pre-sale and post-purchase services like financing, maintenance, channel coordination, and more
  • Creating Efficiencies
  • Sharing Risks: - they also share the risk with the manufacturers and do everything possible to sell the product
  • Marketing - also called marketing channels because many marketing strategies are executed

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What is a Distribution Network?What is a Distribution Network

A distribution network is a group of individuals and organizations that all work together to get the product or service from the manufacturer to the end-user. There are two main channels - direct and indirect. 

Indirect distribution, the manufacturer sells straight to the customer and uses no middle man. 

Some examples include:

  • Manufacturers that are selling their products through their own retail outlets
  • A farmer selling his produce to shoppers at the farmer’s market 
  • Artists using Etsy or eBay to sell to their pieces

Some examples of indirect distribution channels include: 

  • A household products manufacturer may look to popular retail outlets to reach and sell to their target market
  • An online course builder may make use of affiliate sites, reseller programs, or online learning marketplaces to sell their products

Deciding on the perfect marketing channel is tough. Making the right decision is imperative to the success of your company. 

The companies that want to keep a tighter leash on distribution tend to prefer direct channels. Companies who don’t want as much control or those who are just interested in the sales of their products tend to prefer indirect channels as their means of moving the product.

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What are Examples of Distribution Channels?

There are a number of distribution channels that can be found in marketing. For example, a direct sales distribution channel can be a very good distribution model when you want to move any sort of product that has a medium price range and a longer shelf life. Jewelry and stationary, are both great examples of this, as they can be fairly expensive but can sit on the shelf for a long time with no issues. 

Another example of a distribution channel is brokers and distributors. If a manufacturer chooses to partner with agents and brokers, they will act as an extension of the producer as they take on representation of them before the end consumer. 

More channels that B2B and B2C companies can sell through may include the following:

  • Retail
  • Wholesaler/Distributor
  • Direct/Internet
  • Direct/Sales Team
  • Value-Added Reseller (VAR)
  • Consultant
  • Sales Agent/Manufacturer’s Rep
  • Direct/Catalog
  • Dealer

E-commerce Distribution with R+L Global LogisticsWhat is an E-commerce Distribution Network

R+L Logistics can help any producer or manufacturer to take care of their E-commerce distribution needs. If you’re looking for a reliable and experienced company, our professional logistics staff endeavor to go above and beyond in order to provide value-added services that you can tell your peers about. 

The R+L Logistics team will work alongside you to develop a complete supply network solution. Once this is in place, you are then able to develop your brand in the global marketplace, improving the overall efficiency and popularity of your business

The R+L Global Logistics team provide exceptional logistics and transportation solutions that can be relied upon each and every time - our e-commerce distribution network is second to none. If you require help with your shipping and logistics or you’d like further information regarding our services, get in touch with the R+L Global Logistics team today.

Ready to take the next step? Contact us today to learn more about e-commerce distribution

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