A strong and efficient distribution network is an important asset
for a manufacturer or producer. But what exactly is a distribution
network, and what are the advantages?
‘Logistics network’ and ‘shipping network’ are terms used (the
latter typically referring to a global network of maritime services)
to describe a distribution network. In our context, a distribution
network is the combination of transportation, terminal and
warehousing services that we have established to best serve the
needs of our customers. Simply put, the system you use to get your
products from A to B.
Distribution can come in different shapes and set-ups, from small
and simple-size networks to large and very complicated networks of
logistics operations, used by large enterprises such as Apple or
Amazon. Factors involved in defining the shape of the distribution
network are end customer product demands, product variety, product
availability, response time, returnability, and customer experience.
Advantages of a distribution network for manufacturers
is a key driver of your overall profitability. It has a direct
impact on your supply chain costs and customer satisfaction.
Establishing a reliable distribution network can therefore be a
strong competitive advantage and help your business stay
Some of the main benefits of distribution network is reduced costs,
more transparency and collaboration, wider customer reach and faster
growth. Joining a distribution network might sound like a big and
complex operation. But it‘s not! There are cloud-based logistics
management systems available that allow you to create a set of
optimised logistics services designed to suit your particular needs
to serve your customer base.