Objectives of knowledge management

partners
(organisation)
Channel
partners
(suppliers)
Suppliers
Consumer
customers
Business
customers
Customers
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Part 1
Introduction
Figure 2.7 illustrates disintermediation in a graphical form for a simplified retail channel. 
Further intermediaries such as additional distributors may occur in a business‑to‑business 
market. Figure 2.7(a) shows the former position where a company marketed and sold its 
products by ‘pushing’ them through a sales channel. Figure 2.7(b) and Figure 2.7(c) show 
two different types of disintermediation in which the wholesaler (b) or the wholesaler and 
retailer (c) are bypassed, allowing the producer to sell and promote direct to the consumer. 
The benefits of disintermediation to the producer are clear – it is able to remove the sales and 
infrastructure cost of selling through the channel. Benjamin and Weigand (1995) calculated 
that, using the sale of quality shirts as an example, it is possible to make cost savings of 28 per 
cent in the case of (b) and 62 per cent for case (c). Some of these cost savings can be passed 
on to the customer in the form of cost reductions.
Although disintermediation has occurred,