Economics

Distributive Trade · 1 min read

Introduction

Illustration for Introduction in Distributive Trade
Introduction · Distributive Trade

Distributive Trade

This is the way or road that goods take to reach the people who need them.

Channel of distribution alternatively known as distributive trade or chain of distribution refers to the pathway through which goods and services flow from the producer to the final consumer.

It is like a map showing how bread moves from the bakery until it reaches your breakfast table.

You must remember that work is not finished just because you have finished making a product; someone must buy and use it.

It should be noted that production is not complete until the goods and services produced get to the final consumers.

If a farmer grows yams but cannot get them to the market for people to buy, all his hard work is for nothing.

This explains the fact that without the channel of distribution, all that has been produced by the producer are useless and worthless.

Key points

  • Distributive trade is also known as the channel of distribution or chain of distribution.
  • It describes the pathway goods and services take from the producer to the final consumer.
  • Production is not considered complete until goods and services reach the final consumers.
  • Without a channel of distribution, produced goods and services are deemed useless and worthless.