Intermediaries
The quick definition of intermediaries can be linking businesses or organisation between the producers and customers. This normally will resolve around retailers, wholesalers and even agents. This can mean that the retailers are the producers as they are the once who will have the direct link to the customers to sell the product, not only this retailers will be the ones who actually own the product.
Moving on to wholesalers, they will be the organisation that will have a wide range of goods or products to sell to retailers normally in bulk demand. Wholesalers will make life easier for other businesses as they can buy in large number of stock so that they can sell them individually to consumers. In the business world wholesalers will make it easier for all to sell products. Agents will not only link with wholesalers but also with retailers so that they work together and help them by giving them their service.
For the next part of the task I will look at two businesses and there distribution process of each of these businesses, one of these businesses will be an independent retailer. I will use Spar as an independent retailer and the other business I will use will be Tesco.
Tesco
In this part of the task I will look at Tesco and their distribution process. When dealing with this I will look at the different distribution channels, the movements of goods, the stages in between the channel, supply chain, transport requires and storage of the products/goods. Tesco is a large organisation which will mean that it is much bigger than an individual retailer; this can also mean its distribution channel will be much bigger.
Within the UK Tesco is the largest supermarket with 16% of the market share in total. This can show that the business in trust worthy and could be the main reason on why Tesco have there own branded products. These products which are produced also need to be distributed well.
I will pick out a product that is produced by the business and go into the process in which it gets from the manufacturer all the way through then finally to the customer. The product that I will choose from the business will be the self branded crisp products. The process of this product will be different from other products such as clothing. This specific product will be harvest and made on a farm within the UK. This farm will grow the ingredients required for example potatoes. As like any other product will have a sell by date which means it has to be distributed quickly and so it will be transported to headquarters of Tesco by using transport on road. From the headquarters this product then will be sorted out and finally transported to the retailers and then sold to the customers.
Looking in detail at Tesco will its storage and transport, it should be highlighted by them that the business is well structured and organised so that the product they have is in right place at the right time for their customers. If they do not achieve this the retailer not only be losing out on profits and customer loyalty as customer demands are not being met. We know as clothing to food and it is important to them that they meet agreements which these distributors that product arrive at the time given. Storage will also play a part as the business will need good storage for the products to be kept, this can be the reason for the business to have many warehouses and distributors all around the UK. Having this will ensure that the product will be at the right place and at the right time for customers to purchase the products they want to. For every Tesco branch the business will make sure that they have a storage room or stock room so that the products which are not going out on the shop floor will be kept in these stock rooms. As Tesco will be busy business stock room will play a vital part for storage.
IT is always an issue for Tesco as it’s such as large organisations and it helps the business in many ways and most important is that it helps them to keep organised. One way it can come to use is the use of barcodes on products this will allow some form of identification to be done, through tracking of the product. IT can also help the business to become more effective as it can save time in deliveries and other important aspects.
The above diagram can show the basic distribution process for Tesco.
Club JJ’s – Independent Retailer
Now the next business I will look at will be an independent clothing retailer which is Club JJ’s in East London. The business sells mens, women and kids clothing. I will look at this business distribution channel, the movements if goods from manufacturer to the consumer, the supply chain, transport in which the goods are transported within and the storage of these products. Club JJ’s is a small independent retailer which will mean their distribution channel will not be as big as huge organisations such as Tesco. A small independent retailer will have also have a supply chain on how the products are made or given to the business.
Most of the clothes which Club JJ’s sell will be from abroad as they are designer clothing. These products will be made within factories within China or other Far East countries. The products will travel through a process before purchased by the retailer, as first the material will need to be made then printed out with a design and this all will be done within the factory. Finally when the clothes are made it will be sent out to other countries such as England where the products will be packaged. Club JJ’s will have there own warehouse where they can keep these products within and then sent to the store so that customers can purchase. As the business is a small retailer they will not have the space to keep the entire product on the shop floor. Also the business will have a stock room to keep these products or clothing.
The transport which will be used for their product will be through water and road the reason this is the products will travel though water within a ship which will work most efficient as it will be in large quantity. However it will take a long time as there is a lot of distance to be travelled. When they reach England these products will be taken to a warehouse by using the road through Lorries or maybe other suitable vehicles. After this is done the product will reach the business so that they can be sold. Club JJ’s will many stages within the distribution process this is because they are an independent retailer.
The above diagram can show the distribution process for Club JJ’s.
Conclusion
In this task I have talked about distribution process. I have looked at the distribution process and how goods are transported from the manufacturer to the customer. In this task I have also looked at two contrasting businesses in which I have looked down within the distribution process for example the different distribution channels, logistics and methods of transportation for these individual businesses.
