What is a direct channel of distribution?
The channel of distribution is said to be a network of institutions that perform a variety of interrelated and coordinated functions in the movement of goods from producers to consumers. Various functions are performed by the channels of distribution like buying, selling, storage, financing, market information, grading, risk bearing etc. Direct channel is one of the types of distribution channels.
When there is no middlemen involved between producer and consumer and when the goods of the producer are sold by him directly to the consumers, it is called a direct channel. Producers maintain a direct and personal link with the consumers with the help of traveling salesmen or by establishing their own retail shops or showrooms. In order to sell the goods directly to the customers, producers establish and set up retail shops or showrooms in various localities. Retail shops are small ones where the goods are displayed so that the consumer makes the choice after glancing through them. The chain goes on as follows:
Producer → Traveling Salesman → Consumer
Producer → Retail shopper or showroom → Consumer
The work of the salesmen is to book orders by contacting the-potential buyers personally, and supply may be arranged from the stock held by the producer himself. This helps a producer to keep a proper check on the supply of goods.. It proves to be beneficial to the consumers also, as they can get the goods easily in order to fulfill their needs.