3.4.7 Distribution

Place, in general, refers to the distribution system that supplies goods or services to customers. This includes shops and mail order. The concept of place also covers types of transport employed, storage and warehousing, and the use of wholesalers.

The number of middle men will vary from industry to industry, but the more intermediaries there are, the higher the final price to the customer. This can result in added cost to the rural business as frequently there is more work and there may be more people involved before the product reaches its customer destination.

Very often the problem for new small firms is gaining access to the distribution channels (think back to Porter’s five forces model). Their lack of economies of scale and related bargaining power, plus the absence of a recognisable brand, are factors that seriously limit their supply chain power.