Total distribution cost

Prepared by-
Makesh V
Tushar W
Anurag M
Sandip R
 Chintan M
Pankaj S
 Total distribution cost

Definition
Measures how much the distribution cost per trip
represents out of the sales delivered by that specific
trip.
a cost incurred to warehouse, transport, or deliver a
product or service
 Total distribution cost

Distribution costs are subdivided into net and supplementary costs.

 Net costs result from the act of buying and selling and from changes
in the forms of value in the process of selling commodities.
These costs include expenditures for paying salaries to the sellers,
advertising, keeping account books, and so on.
Net costs are not productive in nature and do not add any value to
the commodity.
 Supplementary distribution costs are productive; they involve
continuing the process of production in the sphere of commodity
circulation and increase the value of the product; these include
expenditures for transporting the commodities, finishing them,
storing them, putting them into sets, wrapping, packaging, and so
on.
 AN ANALYSIS OF
DISTRIBUTION COSTS

One of the major components of the cost of distribution was travel agency
commissions, which reached a peak of almost 12% of passenger revenue
Another substantial cost component to the airlines, and thus ultimately
t o the consumer, are Global Distribution System (GDS) booking fees. These
fees arise whenever a consumer buys an airline ticket through a travel agency,
tour operator, wholesaler, or internet-based agency. The booking by the
consumer, unless made directly with the supplier, e.g., air carrier, hotel or car
rental company, is made by the intermediary agent on one of four major
GDSs: Sabre, Galileo, Amadeus, and Worldspan.
Distribution Channels
 Distribution Channels

The actual transaction reserves the seat and creates the ticket.
This is accomplished by large legacy computer systems owned
by the GDSs. The travel agency or other intermediary has
made
the sale, but the cost of the sale is billed to the supplier, in this
instance the airline, hotel, car rental company, etc. In
numerous
studies of the cost structure of GDS booking fees over the past
few years, we have found that while other distribution costs
have been declining, either in an absolute sense or as a percent
of revenue generated, booking fee costs have been increasing.
 Mutual Fund Fees and Expenses

As with any business, running a Mutual Fund

involves costs. For example, there are costs incurred
in connection with particular investor transactions,
such as investor purchases, exchanges, and
redemptions. There are also regular fund operating
costs that are not necessarily associated with any
particular investor transaction, such as investment
advisory fees, marketing and distribution expenses,
brokerage fees, and custodial, transfer agency, legal,
and accountants fees.