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Definition: Conventional Distribution is the traditional and most common way of distributing products. Distribution is performed from the manufacturer (producer) to wholesalers to retailers to the consumer. All parties are autonomous and act independently, aiming at maximizing their own profits. Channel conflicts are common, leading to disruptions in the distribution.
Increasingly supply chains are competing with other supply chains, so better, faster and more flexible coordination between all parties is needed.
Due to this, companies are using vertical integration, and various forms of supply chain collaboration to create more flexible and collaborative ways of distribution.