Place 2
Business: Edexcel IGCSE, topic 4.3.15
Direct to Consumer
Direct to consumer distribution involves selling directly to individual customers. This is the cheapest channel for the consumer and it is often done by businesses using their own website.
Nobody else takes a cut
- Selling direct to consumer lets a business charge the lowest price possible to the consumer because there are no intermediaries (organisations in the middle) who take a cut of the profit.
- Alternatively, the business can charge the same price and have a higher margin.
Hard to reach customers
- It can be hard to reach as many customers as quickly because a firm will have to invest time and money into setting up new stores or their own website.
E-commerce
- It is becoming easier to reach more consumers directly with with the use of e-commerce and m-commerce.
- This means that lots of businesses don't need to set up physical stores.
Test yourself on Place 2
What is a benefit of selling direct to customers?
Why is it becoming easier for businesses to reach more customers without setting up a store?