What do you mean by the place mix? Describe the factors affecting the channels of distributions.

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Explain the factors determining the choice of channels of distribution.

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Explain, in brief, the factors on which the choice of channels of distribution depends.

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Choice of channels of distribution depends on various factors. Explain any four factors which affect the choice of channels of distribution.

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Explain ‘Market’, ‘Product’ and ‘Company’ related factors determining the choice of channels of distribution.

Place mix: It refers to a set of decisions that need to be taken in order to make the product available to the consumers for purchase and consumption.

A manufacturer should keep into consideration the following factors while selecting a channel of distribution.

1. Product-related factors:
   1. Unit Value of the Product: When the product is very costly it is best to use small distribution channel. For example, Industrial Machinery or Gold Ornaments are very costly products that's why for their distribution small distribution channel is used. On the other hand, for the less costly products long distribution channel is used.
   2. Perishability: A manufacturer should choose minimum / no middlemen as channel of distribution for such an item or product which is of highly perishable nature. On the contrary, a long distribution channel can be selected for durable goods.
2. Market-related factors:
   1. Number of Buyers: If the number of buyers is large then it is better to take the services of middlemen for the distribution of the goods. On the contrary, the distribution should be done by the manufacturer directly if the number of buyers are less.
   2. Types of Buyers: Buyers can be of two types: General Buyers and Industrial Buyers. If the more buyers of the product belong to general category then there can be more middlemen. But in case of industrial buyers there can be less middlemen.
3. Company-related factors:
   1. Desire to control the channel of Distribution: Manufacturer ambition to control the channel of distribution affects its selection. Consumers should be approached directly by such type of manufacturer. For example, electronic goods sector with a motive to control the service levels provided to the customers at the point of sale are resorting to company-owned retail counters.
   2. Financial Strength: A company which has strong financial base can evolve its own channels. On the other hand, financially weak companies would have to depend upon middlemen.
      
4. Government-related factors: Considerations related to the government also affect the selection of a channel of distribution. For example, only a license holder can sell medicines in the market according to the law of the government. In this situation, the manufacturer of medicines should take care that the distribution of his product takes place only through such middlemen who have the relevant license.