What do you understand by physical distribution of goods ? Explain the elements of physical distribution.

Answer – Physical distribution moves finished goods from producers to customers efficiently and reliably.

Four principal components:

• Order processing: receive, verify and execute orders accurately and promptly.
• Transportation: choose suitable modes for cost, speed, reliability and product requirements.
• Warehousing: store goods in appropriate locations to bridge the time between production and consumption.
• Inventory control: maintain enough stock for service while avoiding excessive holding cost and obsolescence.

The prescribed main list has four components; a question requesting six should not lead to invented categories.

Distribution channels are the routes through which products reach buyers. Direct or zero-level selling connects producer and consumer; one-level uses a retailer; two-level uses wholesaler and retailer; longer channels may add an agent. Intermediaries can sort, accumulate, allocate and assort goods, promote products, negotiate, bear risk and support availability.