Distribution Management

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CH1: MARKETING CHANNEL CONCEPTS Growing Importance of Marketing Channels: 1. Explosion of IT and E-commerce 2. Harder to gain sustainable competitive advantage through other P’s 3. Growing power of distributors (esp. retailers who act as gatekeepers of consumer markets – agents of consumers not producers) 4. Need to reduce distribution costs

MC Definition: The external contactual organisation that management operates to achieve its distribution objectives (from view of mgmt. Definition will differ for each stakeholder) External – not part of firm. Contactual organisation – those firms involved in negotiatory functions (buying, selling, transferring title) as a product
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Increased size and buying power b. application of advanced technologies c. use of modern marketing strategies Distribution tasks performed by Retailers: - Increase the proximity and contact points with end consumers for producers/wholesalers. - Provide personal selling, advertising and display to aid selling suppliers’ products. - Interpreting customer demand and relaying this info back through the channel - Dividing large quantities into consumer-sized lots, thus providing economies for supplier and convenience for customer. - Provide storage for suppliers - Remove risk form the producer by ordering and accepting delivery in advance of season.

CH3: THE ENVIRONMENT OF MCs 1. Economic 2. Competitive (Global and domestic) 3. Sociocultural (esp. important in Global MCs) 4. Technological (Internet = Electronic MC) 5. Legal

Managers have to think about environmental impacts on MC members and Facilitating agents as well as their own firm and target market.

Types of MC Competition: 1. Horizontal – between firms of the same type. (coles vs. woolies) 2. Intertype – between different types of firms at the same channel level. (Retailers vs. Superstores) 3. Vertical – between channel members at different levels in the MC. (Retailers vs.
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