What is 'disintermediation' and does it help producers? Explain how....

 

Disintermediation is the removal of intermediaries in a supply chain: "cutting out the middleman". Instead of going through traditional distribution channels, which had some type of intermediate (such as a distributor, wholesaler, broker, or agent, companies may now deal with every customer directly, For example via the Internet. One important factor is a drop in the cost of servicing customers directly.

Disintermediation initiated by consumers is often the result of high market transparency, in that buyers are aware of supply prices direct from the manufacturer. Buyers by pass the middlemen (wholesalers and retailers) in order to buy directly from the manufacturer and thereby pay less. Buyers can alternatively elect to purchase from wholesalers.

How Disintermediation would help ASOS producers?

Disintermediation would help ASOS producers. The producers are the people who produce products for companies for example ASOS manufactures of ASOS and also an improvement as well; because they can sell their products directly to ASOS rather then selling it through other people or companies and paying extra money to them for keeping their products and selling;  which would cause problems such as products not being deliverd on time or some products could get lost.

 If the manufactures sell directly to ASOS they can get the right price for their product however if they sell their product through middle man they would have to spend money on that.

 

 

 

Unit 12 Investigating Internet Marketing-P1