Written and maintained by CASRAI Editorial Board
Last updated
General information for lab, clinic and procurement staff; not legal, regulatory or medical advice.
Short answer
A distribution channel is the route a product takes from its maker to the organisation that uses it. A direct channel has no intermediary; an indirect channel passes through one or more intermediaries such as agents, brokers, distributors or wholesalers. For lab and clinic supplies, the channel decides who holds the product, who can answer for its labelling, and which documents you should ask for.
Definition and scope
OpenStax Principles of Marketing (checked 2026-11-03) says a direct marketing channel does not use intermediaries, while an indirect channel involves one or more intermediaries to distribute an offering. In its discussion of industrial products it refers to agents, brokers, distributors and wholesalers who specialize in moving products to business buyers, which is the market where laboratory and clinical supply buying sits.
How channels work in practice
OpenStax gives producer to wholesaler to retailer to consumer as an example of a longer indirect chain, and notes that the direct channel is typically used when the nature of the product is complex or expensive. It separates the intermediaries by ownership: an agent or broker does not take possession of or ownership of the product and earns a commission or fee, a distributor takes ownership of the product, and a wholesaler also takes ownership, buying a variety of products in large quantities and breaking bulk. For buyers that distinction matters: an agent negotiates, while a distributor or wholesaler is the party that holds and resells stock.
Types of distribution channels
Direct
You buy from the manufacturer. The party answering for the product and the party selling it are the same.
Indirect
You buy from an intermediary. For medical-surgical and laboratory products this is most often a distributor or wholesaler, sometimes arranged through a buying group; see group purchasing organization and who buys medical supplies for the buyer segments.
Types of distributors
Terms overlap in everyday use. In OpenStax’s wording, an agent or broker facilitates a sale without taking possession, a distributor takes ownership and tends to align closely with a manufacturer, and a wholesaler takes ownership of a variety of products bought in bulk. CASRAI separates the everyday terms in dealer vs distributor, supplier vs distributor and wholesaler vs retailer. For how the pharmaceutical, medical-surgical and laboratory channels differ in practice, see healthcare distribution and medical supply distribution.
Where it matters for labs, clinics and supply decisions
For US-regulated medical devices, the channel position of a company changes its FDA registration duties. FDA’s “Who Must Register, List and Pay the Fee” page (fda.gov, checked 2026-11-03) lists these activities (the page is dated 2018, so check the current version):
| Role in the channel | Must register with FDA (domestic) | Cite |
|---|---|---|
| Manufacturer, including kit assemblers | Yes | 21 CFR 807.20(a) |
| Relabeler or repackager | Yes | 21 CFR 807.20(a)(3) |
| Initial importer | Yes | 21 CFR 807.40(a) |
| Domestic distributor that does not import devices | No | 21 CFR 807.20(c)(3) |
| Wholesale distributor that is not a manufacturer or importer | No | FDA table |
The practical reading is a document checklist by channel position, not a quality ranking:
- Buying direct from the manufacturer: the manufacturer’s own registration and listing, plus the instructions for use and labelling.
- Buying from a distributor that only stores and ships: do not treat absence from FDA’s registration database as a red flag; the table shows such distributors are not required to register. Ask instead who the manufacturer is and request the product’s labelling as supplied.
- Buying from anyone who repackages, relabels or imports: that party falls into a registering category, so its registration is a fair thing to ask about.
Common misunderstandings
- “Distributor” and “agent” mean the same thing. In the marketing text, an agent does not take ownership; other intermediaries do.
- An unregistered distributor is non-compliant. Per FDA’s table, non-importing, non-manufacturing distributors are not required to register.
- Direct is always the shortest route to a better outcome. The source says only that direct is typically used for complex or costly products; it makes no claim that either channel is better for every buyer.
FAQ
What are the types of distribution channels?
Direct (no intermediaries) and indirect (one or more intermediaries), per OpenStax. For lab and clinic supplies, indirect usually means a distributor or wholesaler.
What are the types of distributors?
OpenStax distinguishes agents or brokers (no ownership of the product), distributors (take ownership, often aligned with one manufacturer) and wholesalers (take ownership, buy many products in bulk). Retailers also take ownership and sell to the end user.
Does a medical-device distributor have to register with FDA?
Per FDA’s table, a domestic distributor that does not import devices and a wholesale distributor that is not a manufacturer or importer are marked No for registration. Manufacturers, relabelers and repackagers, and initial importers are marked Yes.
Sources
- OpenStax, Principles of Marketing, 17.1 “The Use and Value of Marketing Channels”: https://openstax.org/books/principles-marketing/pages/17-1-the-use-and-value-of-marketing-channels (checked 2026-11-03).
- OpenStax, Principles of Marketing, 17.2 “Types of Marketing Channels”: https://openstax.org/books/principles-marketing/pages/17-2-types-of-marketing-channels (checked 2026-11-03).
- US FDA, “Who Must Register, List and Pay the Fee”: https://www.fda.gov/medical-devices/device-registration-and-listing/who-must-register-list-and-pay-fee (checked 2026-11-03).
