Distribution Network

AAA

DEFINITION of 'Distribution Network'

An interrelated arrangement of people, storage facilities and transportation systems that moves goods and services from producers to consumers. A distribution network is the system a company uses to get products from the manufacturer to the retailer. A fast and reliable distribution network is essential to a successful business because customers must be able to get products and services when they want them.

INVESTOPEDIA EXPLAINS 'Distribution Network'

Walmart is well-known for the high quality of its distribution network, which helps the company control costs and maintain its competitive advantage. Its distribution network consists of thousands of associates; a private fleet of drivers; and numerous distribution centers and transportation offices. One of the ways its distribution network eliminates costs is my minimizing the number of empty miles its trucks travel.

RELATED TERMS
  1. Reverse Fulfillment

    The portion of the supply chain that moves returned products ...
  2. Disintermediary

    Anything that removes the "middleman" (intermediary) in a supply ...
  3. Organizational Structure

    Explicit and implicit institutional rules and policies designed ...
  4. Middleman

    A slang term for an intermediary in a transaction or process ...
  5. Sales And Purchase Agreement - ...

    A legal contract that obligates a buyer to buy and a seller to ...
  6. Value Chain

    A high-level model of how businesses receive raw materials as ...
RELATED FAQS
  1. When does Q4 start and finish?

    Most companies such as Facebook have financial years that end on December 31st. For these companies, the fourth quarter begins ... Read Full Answer >>
  2. When is it useful to look at a company's fixed asset turnover ratio?

    It is useful to look at a company's fixed asset turnover ratio when an outside observer, such as an investor, wants to know ... Read Full Answer >>
  3. What is the difference between perfect and imperfect competition?

    Perfect competition is a microeconomics concept that describes a market structure controlled entirely by market forces. In ... Read Full Answer >>
  4. How difficult is it to understand business analytics?

    In the abstract, business analytics is the study of financial, economic, consumer and production data through statistical ... Read Full Answer >>
  5. At what levels are core competencies required for businesses operating in the primary ...

    Core competencies help businesses understand their best abilities to perform in the market. Primary sector businesses mine ... Read Full Answer >>
  6. What are the variables in variable costs?

    Variable cost is an economic term that refers to an expense a company is facing that varies based on factors that are inconsistent ... Read Full Answer >>
Related Articles
  1. Insurance

    Working Capital Works

    A company's efficiency, financial strength and cash-flow health show in its management of working capital.
  2. Active Trading Fundamentals

    Operational Risk: A Must-Know For Investors

    This type of risk is often overlooked, but it can mean the downfall of a company - and its investors.
  3. Retirement

    The Evolution Of Enterprise Risk Management

    This growing sector can tell you a lot about the companies you are investing in.
  4. Economics

    What is a Management Buyout?

    A management buyout, or MBO, is a transaction where a company's management team purchases the assets and operations of the business they manage.
  5. Economics

    Explaining Cash On Delivery

    Cash on delivery, also referred to as COD, is a method of shipping goods to buyers who do not have credit terms with the seller.
  6. Fundamental Analysis

    Understanding the Simple Random Sample

    A simple random sample is a subset of a statistical population in which each member of the subset has an equal probability of being chosen.
  7. Economics

    International Financial Reporting Standards (IFRS)

    International Financial Reporting Standards are accounting rules and guidelines governing the reporting of different types of accounting transactions.
  8. Economics

    Understanding Economic Order Quantity

    Economic order quantity is an inventory-related equation that determines the optimum order quantity that a company should hold in its inventory.
  9. Economics

    What is Net Margin?

    The ratio of net profits to revenues for a company that shows how much of each dollar earned by the company is translated into profits.
  10. Investing Basics

    What is a Stock Option?

    An employee stock option is a right given to an employee to buy a certain number of company stock shares at a certain time and price in the future.

You May Also Like

Hot Definitions
  1. Fiduciary

    1. A person legally appointed and authorized to hold assets in trust for another person. The fiduciary manages the assets ...
  2. Expected Return

    The amount one would anticipate receiving on an investment that has various known or expected rates of return. For example, ...
  3. Carrying Value

    An accounting measure of value, where the value of an asset or a company is based on the figures in the company's balance ...
  4. Capital Account

    A national account that shows the net change in asset ownership for a nation. The capital account is the net result of public ...
  5. Brand Equity

    The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. ...
Trading Center