a : Indirect - marketing channel : Producer,Wholesaler, Retailer, Consumer

This traditional channel of distribution has two intermediaries, the wholesaler and the retailer. Often used by manufacturers of food, drugs, and hardware, the Wholesaler purchases the product in large bulk quantities from the producer, and then breaks these bulk purchases down into smaller quantities, which are then sold onto retailers, who then sell them to the consumer, often individually.

The advantage for the producer in using this traditional channel of distribution is that they can sell all their product to one, or more normally a small number of wholesalers, who have formed a close working relationship with networks of retailers across the UK and overseas.

In return for taking on the task of distributing the product to retailers across the UK and overseas, Wholesalers will add their profit margin to the cost of the product, before it is purchased by the retailer.

Small retailers, who would not be able to purchase in large enough quantities to justify purchasing directly from the producer, can still acquire the product from the wholesaler, in smaller amounts. In addition the wholesaler will offer a number of incentives to retailers to purchase product through them, including credit, special delivery arrangements, alongside advice and choice in terms of offering product from a number of competing producers under one roof.

b : Indirect - marketing channel : Producer, Retailer, Consumer

Producers of televisions, furniture, and major appliances, tend to sell their product to large retailers such as Marks & Spencer and Dixons. Able to buy in the large quantities preferred by the producer, the major retailers organise their own distribution of the product to their retail outlets. By purchasing in large quantities they are able to negotiate discounts from the producer, which more than cover the costs of providing their own distribution network.

Producers are attracted to larger retailers not only for their capacity to purchase in bulk, but also for the large share they have of the markets the producer wishes to supply.

c : Direct - marketing channel : Producer, Consumer

By selling directly to the consumer, producers can potentially offer their product at prices lower than those of competitors, who supply through channel intermediaries - wholesalers and retailers. Alternatively the profits that had been shared with channel intermediaries can be retained by the producer, by selling directly to the consumer. Companies such as the computer company Dell, sell their computers by mail-order or over the Internet, rather than through large retailers such as PC World. The growth of the Internet, and online purchasing has provided many producers, who where previously reliant on securing deals with the large retailers, or wholesalers, with the ability to sell direct to the consumer.