Welcome to the distribution channel module. I will be your instructor in this module. I am Maria Aranzabal. I have more than 25 years of experience in fashion, retailing, and consulting. I have gone through the whole process from setting the strategy to designing and implementing distribution channels strategies. I have launched different channels in different countries for very diverse sectors, from convenience stores in gas stations to new channels in banking to fashion, accessories, gourmet, and lifestyle brands. In this module, you will learn how to plan and manage distribution channels and how they are evolving with the growing importance of trade marketing that is developing into considering channels as partners. We will learn to implement the right retail strategy and to develop a sustainable competitive advantage. Furthermore, due to the importance of globalization, we will learn different growth strategies, the type of retail channels that can be used and of course, the importance of the online retailing with the e and n-commerce. Why having distribution channels is so important? An individual firm's success depends not only on how well it performs but also on how well its entire marketing channels compete with competitor channels. Good distribution strategies can contribute a strongly to customer value and to create a competitive advantage for a firm. Channel marketing performs the work of moving products and services from producers to business users of final consumers. It overcomes the time, place, and position gaps. One of the chief roles is to transform the assortment of products made by the producer into the assortments wanted by the consumers. Channels must not just serve markets, they must also make markets. The chosen channels affect all other marketing decisions. Only a few producers sell their goods directly to final users. Most of them use intermediaries and the most known ones are; retailers, sell products or services directly to final consumers for their personal non-business use. We have also the wholesalers, they sell goods and services to those buying for resale or business use. I can highlight the following type of wholesalers; the merchant wholesalers that they do take title of goods, brokers and agents that they don't take title of goods and they perform only few functions. Finally, the manufacturer's sales branches and offices where wholesaling is done by sellers and buyer themselves rather than through independent wholesalers. Now that we know why distribution channels are important, which are the channel member functions through their contacts experience a specialization and a scale of operation intermediary make offering widely available and accessible to target markets, usually providing their firm with more effectiveness and efficiency than it can be achieved on its own. Some functions help to complete transactions. For example, gathered information about potential and current customers, competitors and other forces. Promotion, developing communication to stimulate purchasing. Contact, finding and communicating with prospective buyers. Matching, shaping and fitting the offer to the buyer's needs and negotiation, reaching an agreement on price and other terms of the offer so that the ownership or possession can be transfer. There is another group of functions that they're here to fulfill the complete transaction, would be the physical distribution, transporting an storing good. Financing, acquiring and using funds to cover the cost of channel work. Risk-taking, assuming the risk of carrying out the channel work. All channel functions have three things in common. They use up a scarce resources. They can often be performed better through specialization. Finally, these functions can be shift among channel members. In the next session, we will learn to design a distribution channel, what steps do we need to implement it.