Channels of Distribution
Evaluating the channels of distribution is an important step for every specialist in business and marketing because it can be extremely helpful when one has a need to assess the certain aspects or problems of some business – they can often be found in the supply chain organization. To get an idea about the supply chains, the one of the puffs facial tissues shall be reviewed as an example. In this the example author shall try to map the supply chain of facial tissues as far as it is possible.
Generally, the supply chain can be divided into four main stages. Procurement involves providing the raw materials. Production converts raw material into finished products. Distribution moves the product to retailers. Saledelivers the product directly to customers (Freischmann et al, 2002). The first point of the supply chain is the wood. Wood is the primary raw material for making facial tissues. For instance, wood can be bought in Canada. If the imagined company for which the supply chain is mapped is to be situated in United States, buying wood in Canada is a natural because this country is one of the big players in the lumber industry. However, as facial tissues are made of wood pulp. There is no use for the company which produces the tissues to buy lumber directly, unless it has own facilities where that can be turned into a wood pulp. In this way, the wood is to be transported to the some Canadian company that is able to turn it into a wood pulp. It is no surprise that there are many companies involved in the chain as it very rare when one single company does all the stages of process (Carlsson et. all, 2006). The wood is transported via trucks from harvest areas to intermediate storages or directly to the pulp mill. The logs are processed there into wood pulp which is in its turn stored and transported again by trucks to the tissue-making company to USA from Canada. The pulp is processed in USA into facial tissues and packaged. Packed tissues are then delivered via trucks to the retailers. The retailers or distributors work with the particular stores situated around the country. These stores make their own purchases from the distributors and get the parties of tissues delivered to them. The delivery here is done using the vehicles of smaller scale as stores do not make their purchases in volumes that are typical for production and procurement stages. Distributors store the product until it all is bought by stores or, in case of products of other type, cannot be stored no longer due to hygienic or safety reasons. Basically, the whole supply chain for the facial tissues products can be pictured in the following way: wood harvesting area, intermediate storage/pulp mill – intermediate storage/tissue-producing company – retailers and their storages – stores – customers. All the delivery is assumed to be done using vehicles with the possible exception …
