What is Width of Distribution???
Distribution channel width is measured by the number of different entities available for providing the same distribution function (as a distributor, wholesaler or retailer) at different stages in a distribution channel
- Width of Distribution – No. of sales points the product or service is available against total sales points in the region.
For Example A Brand X width of distribution in a city with 5000 FMCG outlets would be in how many outlets the Brand X product is present. If it is present in 4500 outlets, its width of distribution for that geography would be 90%.
With the advent of new POS with e-commerce sites, the entire rule of the gap has changed.
Parameters of Width of Distribution:
- Visibility of the product – More outlets stocking will result in more people seeing the product and hence more the chances of the product being recalled and thereby sold.
- Channel commitment to sell the product – More quantity stocked will increase the pressure on the retail POS to quickly liquidate the product and earn a profit.
- The other parameter to measure is the Depth of Distribution. This signifies the range of SKUs present in the distribution channel of the brand.