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Chain of Production
• The various production or processing stages that a good or service goes through before it is sold to the consumer.
Sectors Involved in Manufacturing and Distribution of Products
• The primary sector – These industries can take material from the land or the sea.
• The secondary sector – This is the manufacturing and construction sector of the economy.
• The tertiary sector – Made up of firms that provide services to all other sectors of the economy.
• These industries can take material from the land or the sea.
• The firms in this sector use the goods produced by the primary sector and change them into finished products.
• The firms provide services in this sector to consumers.
Channels of Distribution
• Are the methods used to transfer finished goods from manufacturers to consumers.
1. Manufacturer > Consumer
2. Manufacturer > Retailer > Consumer
3. Manufacturer > Wholesaler > Retailer > Consumer
4. Manufacturer > Wholesaler > Jobber > Retailer > Consumer
• A special type of wholesaler and only sells one type of item.
• A wholesaler is a company or person that buys large quantities of goods from many manufacturers and sells them in smaller quantities to retailers.
Cash and Carry Wholesalers
• Located in most large towns.
• Differ from traditional wholesalers in the following ways:
1. They do not give credit.
2. They do not deliver goods.
3. They operate on a self service basis.
4. Their prices tend to be lower than traditional wholesalers because:
• They are paid cash for goods.
• They do not have to invest in delivery trucks.
• Less staff is required due to self service.
• A franchise exists when the owners of a business give permission to another person to set up a branch and their business in another location in return for a fee.
• A retailer is somebody who sells finished goods to consumers.
• They buy goods in bulk and sell them in single units or small quantities to consumers.
Types of Retailers
Retailer Description Examples
Unit or independent retailers Small privately owned shops Toys ‘r’ Us
Voluntary groups Group of retailers who agree to buy their stock from one particular wholesaler only Centra, Spar, Mace
Supermarkets Large shops Tesco, Dunnes Stores
Chain stores Many branches worldwide Walmart
Multiple stores Specialise in one good Elverys, Waltons
Department stores A number of shops under one roof Arnotts, Debenhams
Discount stores Sells a limited range of products at low prices Power City, Dealz, EuroGiant
Vending machines Automated retail devices that sell chocolate, drinks and crisps
Functions of Retailers
1. Provide a wide range of goods to consumers.
2. Sells goods to consumers in small quantities.
3. Offer advice to consumers on certain products.
4. Offer advice to wholesalers and manufacturers on changes in consumer trends.
5. Create demand for goods through their own advertising.
Recent Trends in Retailing in Ireland
• The arrival of International discount stores in the grocery and related industry.
• Major growth in the number of shopping centres and retail outlets.
• Greater use of e-commerce. i.e. selling goods and services over the internet.
• Growth of farmers market – big demand for organic goods.