Objectives of knowledge management

Review of marketplace channel structures
Marketplace channel structures describe the way a manufacturer or organisation delivers 
products and services to its customers. Typical channel structures between business and con‑
sumer organisations are shown in Figure 2.6.
A distribution channel will consist of one or more intermediaries such as wholesal‑
ers and retailers. The relationship between a company and its channel partners shown in 
Figure 2.6 can be dramatically altered by the opportunities afforded by the Internet. This 
occurs because the Internet offers a means of bypassing some of the channel partners. This 
process is known as 
disintermediation
or ‘cutting out the middleman’. For example, a music 
company today can distribute digital tracks straight to sites such as iTunes and Napster, a 
major change to their channel strategy which has led to the closure of many music stores. 
Bands can even bypass retailers and sell direct; for example, in 2008 Radiohead released their 
In Rainbows
album direct from their site, allowing purchasers to name their own price!
Electronic 
marketplace
A virtual marketplace 
such as the Internet in 
which no direct contact 
occurs between buyers 
and sellers.
Disintermediation
The removal of 
intermediaries such 
as distributors or 
brokers that formerly 
linked a company to its 
customers.
Location of trading in the marketplace
Figure 2.6
B2B and B2C interactions between an organisation, its suppliers and its 
customers
Key
Suppliers
Business-to-business (B2B) transactions
Business-to-consumer (B2C) transactions
Organisation
Intermediaries
Channel