Define Physical distribution and Channel of Distribution. What are the differences between Physical distribution and Channel of Distribution?

Physical distribution

Creating a customer is a major task of marketing but delivering the goods to the customer so created is the most critical task. Physical distribution is a marketing activity that concerns the handling and the movement of goods. It is a major component of the marketing mix and cost area of business.

In the words of Phillip Kotler, “Physical distribution involves planning, implementing and controlling the physical flow of materials, and final goods from the point of origin of use to meet customer needs at a profit.”

It involves the coordination of activities to place the right quantity of the right goods at the desired place and time. Like any other marketing mix component, physical distribution has two broad objectives to attain, namely, consumer satisfaction and profit maximization. Physical distribution is not only a cost but a powerful tool of competitive marketing.

Channel of distribution
A channel of distribution is an organized network or system of agencies and institutions, which, in combination, perform all the activities required to link producers with users and users with producers to accomplish the marketing task.

According to Phillip Kotler,” It is a set of independent organizations involved in the process of making a product or service available for use or consumption.” Thus, a channel of distribution is a pathway directing the flow of goods and services from producers to consumers composed of intermediaries through their functions and attainment of the mutual objectives.

Difference between Physical distribution and Channel of Distribution

These are the two component of the distribution system. Physical distribution is a broader concept, it includes a channel of distribution. Physical distribution is concerned with transportation, storage, warehousing, etc, whereas the channel of distribution refers to the process or intermediaries through which goods move from the producer to the ultimate consumer.