Page 1 - Lesson Note 6

SAI INTERNATIONAL SCHOOL

Class-12
th
Business studies

Chapter – 11, Marketing Management

Topics: Physical movement, Promotion Mix, Advertisement (Excluding role & object)
(Lesson Note - 45)

PHYSICAL DISTRIBUTION

Once goods are manufactured, packaged, branded, priced, and promoted, these must be made available

to customers at the right place, in right quantity and at the right time.

For example, a person convinced about the quality etc. of a product, say, a detergent bar, wants to
purchase the same. He/She goes to a retail outlet and asks for the product. If that product is not

available in that shop he/she may purchase some of the alternative brand available. This way a sure sale
is lost because goods were not available at the place where the customer wanted to purchase. Thus, it is

an important responsibility of the marketers to make the product physically available at a place where
the customers would like them to buy.

The physical handling and movement of goods from place of production to the place of distribution is

referred to as physical distribution, which is a very important element of marketing mix.

Physical distribution covers all the activities required to physically move goods from manufacturers to
the customers. Important activities involved in the physical distribution include transportation,
warehousing, material handling, and inventory control. These activities constitute major components of

physical distribution.

Components of Physical Distribution

The main components of physical distribution are explained as follows:

1. Order Processing: In a typical buyer-seller relationship order placement is the first step. Products

flow from manufacturers to customers via channel members while orders flow in the reverse direction,
from customers to the manufacturers. A good physical distribution system should provide for an

accurate and speedy processing of orders, in the absence of which goods would reach the customers