![]() These are the supplier, manufacturer, wholesaler, retailer and buyer. To illustrate, a typical B2C supply chain is composed of four or five entities. However manufacturers will still incur distribution costs, such as the physical transport of goods, packaging in small units, advertising, and customer helplines, some or all of which would previously have been borne by the intermediary. Often, a business-to-consumer electronic commerce (B2C) company functions as the bridge between buyer and manufacturer. ![]() Buyers can alternatively elect to purchase from wholesalers. Buyers may choose to bypass the middlemen (wholesalers and retailers) to buy directly from the manufacturer, and pay less. Disintermediation initiated by consumers is often the result of high market transparency, in that buyers are aware of supply prices direct from the manufacturer. ![]() ĭisintermediation may decrease the total cost of servicing customers and may allow the manufacturer to increase profit margins and/or reduce prices. Instead of going through traditional distribution channels, which had some type of intermediary (such as a distributor, wholesaler, broker, or agent), companies may now deal with customers directly, for example via the Internet. Although Webvan failed in its goal of disintermediating the North American supermarket industry, several supermarket chains (like Safeway Inc.) have launched their own delivery services to target the niche market to which Webvan catered.ĭisintermediation is the removal of intermediaries in economics from a supply chain, or "cutting out the middlemen" in connection with a transaction or a series of transactions. ![]()
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