Gujarat BoardEnglish MediumSTD 12 CommerceOCMMARKETING MANAGEMENT5 Marks
Question
What is indirect selling? State its types and define each of them.
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Answer
When the producer sells his products by distributing it to one or more mediators the sale pattern is called indirect selling or sale by mediator.Types of indirect sales:
$(A)$ Single level distribution:
In this distribution system there is only mediator between the producer and consumer. This mediator is called retailer. He purchases the product directly from the producer and distributes it to consumer. There can be a number of retailers for the product.
$(B)$ Double level distribution system:
In this distribution system there are two level mediators between the producer and the retailer. The first one is wholesaler and second, the retailer.
The wholesaler buys the products from the producer in large quantities and sells it to various retailers in small quantities who in turn sell to the consumers. There can be more than one wholesaler.
$(C)$ Three level distribution system:
The distribution system that consists of three mediators between the producer and the consumer namely, agent, wholesaler and retailer is known as three level distribution system.
In this system of distribution, the products first reach the agents or middlemen from producer. The agents supply the product to various wholesalers, wholesalers to retailers and retailers finally to consumers.
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