Question

Arpit, an entrepreneur, was short of capital. He was worried about the fact as to how he will reach out to his customers. He met his friend who is at present working in a start-up firm. He explained to Arpit a way to reach customers without any middlemen which will help him overcome the shortage of cash. So, Arpit decided to keep his channel of distribution simple as advised by his friend.

1. Identify the channel of distribution adopted by Arpit.
2. Explain the channel of distribution mentioned above.
3. Give any two of advantages of this type of channel.

Answer 1

1. The channel of distribution mentioned above is the Direct channel-zero level.
2. This is the simplest and shortest channel in which no middlemen are involved and producers directly sell their products to the consumers.
3. This channel of distribution is fast and economical.