Sales channel mainly serves 4 main functions, they are:
1. Also known as the concentration process, accumulation is the method of bringing various similar products together for a large homogeneous supply.
2. Sorting out the problem is another function of a sales channel that involves the use of inspection or grading for breaking the homogeneous.
3. Sales channels work as an assortment of many related products or services to form an intermediary. Assortment in the manufacturer level is led by production technology and at the consumer level by their consumption patterns.
4. Allocation refers to the process dispersion where similar products and services are broken and accumulated into smaller and similar products.
What are the different types of Sales Channels?
The sales channel is an essential aspect of doing business and sales also for closing sales. The following list reads all the sales channels commonly seen being used in the market.
1. Personal selling: Often used in b2b sales, it uses a salesforce to establish a network of customers to sell them products or services.
2. Outsources Sales: This outsourcing method involves a third party with the responsibility to increase salesforce.
3. Retailers: Providing the products to the retailers who place it in physical locations like shop or showrooms where customers come and buy the products or services.
4. E-commerce: Selling by using digital and online channels.
5. Arbitrageur or reseller: Firms who invest in products and services to resell it to other clients for earning some amount of profit.
6. White Labeling: This is the allowance from your side to the reseller to mark the products and services of yours with their brand name.
7. Direct marketing: Reaching out to customers through traditional and manual methods for sales.
8: Value-added reseller: This is the process of selling by adding some value to the products and services purchased.
9: Original equipment manufacturer: The suppliers supply the raw materials to the firms that can give them back the final product, often seen in b2b sales and marketing.
10. Wholesale: It is the sales in which the distributors are provided with the products in large numbers to sell them to the retailers and e-commerce sellers.
11. Agents: Agents are the types of authorized intermediaries who are allowed to represent the firm or the products and services of the firm in the transaction. In many industries, this type of sales is practiced as it is a convenient source of income to agents too, who get paid commission for their service.