Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

Book of Contents
1. Introduction.................................................................................................................. 2 2. Main concepts of supply chain and distribution channel...............................................3 2.1 Definition of supply chain............................................................................3 2.2 Definition of distribution channel................................................................3 3. Nintendo Supply Chain and Distribution Channel .......................................................5 3.1 Supply Chain for Nintendo Wii...................................................................5 3.2 Distribution Channel for Nintendo Wii........................................................5 4. Service improvements recommendations.......................................................................6 4.1 Services that Nintendo is currently offering to its consumers and possible improvements to its service .........................................................................6 5. Conclusions....................................................................................................................8 6. Reflective statement.......................................................................................................9 7. Bibliography.................................................................................................................10

Graphs and charts

Figure 1- Supply Chain Flow Chart for Nintendo Wii...............................................................3 Figure 2- Distribution Channel Flow Chart for Nintendo Wii...4

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

1. Introduction
This report is going to cover how Nintendo is distributing their products to the customers as well as companys supply chain. It will define Nintendos distribution channel and supply chain. Next, it will cover recommendations for improvement of services related to the distribution channel; lastly it will conclude the findings. Books used in this report will include those written by Chopra and Meindl or Baker.

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

2. Main concepts of supply chain and distribution channel

2.1 Definition of supply chain
Chopra and Meindl (2001) defined a supply chain as consists of all stages involved, directly

or indirectly, in fulfilling a customer request. A supply chain is a network of stages involved in fulfilling customer needs. These stages are: manufactures, external suppliers, traders, transporters, warehouse retailers and customers. In order to improve the effectiveness of the supply chain management, businesses must consider five supply chain drivers, which involve: production, inventory, location, transportation and the information. If these five stages coordinate well, a firm can expect the increases in the sales of goods/service, and the decrease in the cost of operating expenses (Hugos, 2006). Christopher (2005) has identified two processes supply chain, which are pull and push. Push Process Products are manufactured/ assembled in anticipation of customer orders regardless from the demand. Pull Process Production and distribution takes place on the actual customer orders and not the predictions of the demand.

2.2 Definition of distribution channel Distribution is the fourth element of the marketing mix. A distribution channel can be described as a channel that consists all of those steps through which a product must pass between its point of production and consumption (Baker, 1990). According to Baines, Fill and Page (2008), there are three distribution structures that businesses use to deliver product to the customers: Direct There are no intermediary parties are involved (producer-customer) Indirect Intermediaries like: wholesalers or retailers are involved (producerintermediaries-customer) Hybrid Uses both, direct and indirect distribution (producer-intermediariescustomer).

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

Furthermore, Wilson and Gilligan (2005) identified three distribution intensity strategies: Intensive Distribution Usually is required by the businesses if the customers have a variety of brands that they can choose from. Used to cover the whole market and all avaiable outlets It includes consumeable products such as milk or bread. Selective Distribution Using limited number of outlets in geographical area Producer can choose outlets and concentrate on them (offering training, advertising) Durable products like cookers or fridges Exclusive Distribution Only one distributor/retailer or wholesaler is used Used only in particular geographical area Exclusive products, for example Ferrari cars

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

3. Nintendos Supply Chain and Distribution Channel

3.1 Supply Chain for Nintendo Wii Nintendos Wii supply chain begins when the company purchases the raw materials- parts for the console (Moats, 2008). Processor -IBM in New York, and assembled in Canada (Raby, 2006). Graphic -ATI in Canada (Nintendo, 2001-2004). Batteries -Panasonic, around the world (Moats, 2008) Then, all components are assembled by Foxconn Electronics, in Japan (Shilov, 2006). After tests, consoles are sent to the distributors around the world (Moats, 2008). Some distribution centres are in: Portsmouth, Washington, Helsinki, Copenhagen, Victoria, Moscow, and Reykjavik. (Nintendo, N.D) In distributors warehouses products are tested again, to make sure that it has been delivered to the correct geographical area (Moats, 2008). From the distributors warehouses, products are delivered straight to the local retailers warehouses. (Roetting et al., 2010) Finally, the products are put on the shelves in Games, Asda, Tesco, Argos etc, or available at online retailers like Amazon or Play.com, where the customers can buy it whenever they want. (Nintendo, 2012)

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

Start

Processor
(New York/ Canada)

Graphics Card (Canada)

Batteries (Around the World)

Assembling the Product in Japan

No
Product passing tests in Japan

Yes

Assembler Warehouses in Japan Sending to Local Distribution Warehouses

No

Online Retailers
Product passing tests against correct geographical area

(Amazon etc.)
Yes

Consumer

Outlet Retailers (Asda etc.)

Figure 1- Supply Chain Flow Chart for Nintendo Wii

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

3.2 Distribution Channel for Nintendo Wii According to Nintendos Annual Report, (Nintendo, 2011) Nintendo is using an indirect distribution channel. Company uses intermediaries to distribute their consoles to the customers. Business uses selective distribution, which can be find on their website. (Nintendo, 2012) Nintendo has distribution centres in different geographical areas. Therefore, each distribution centre is responsible for delivering the console and related software to the local market. (Obscure, N.D.) Next, goods are shipped from the manufactures to the local distribution centres. (Nintendo, 2011) However, this can be distracted, for example, by bad weather conditions or as it happened in 2011 by tsunami in Japan. (3dsbuzz, 2011) Then consoles are delivered directly to the retailers warehouses. Subsequently, the retailers use their own transport to deliver products to their outlets. (Moats, 2008) On the official Nintendos website a consumer can check where they can buy a console and their availability and then buy it. (Nintendo, 2010)

Producer (Nintendo)

Distributors

Retailers (E.g. Agros)

Consumers

Figure 2- Distribution Channel Flow Chart for Nintendo Wii

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

4. Service improvements recommendations

4.1 Services that Nintendo is currently offering to its consumers and possible improvements to its service. According to Nintendos website (2012), company offers a support for Nintendo customers online, by the phone or emails. The service includes information about setup & connection, manuals, safety, parental control, and troubleshooting section. CustomerServiceSCOREBOARD (2012) has identified that Nintendos customer service has been marked as satisfying. Over 80% reviewers found the customer service helpful and professional, while the lowest score was for reachability of service and products. Nintendo could open physical stores where customers can buy products and get advices. This would build better relation between Nintendo and their customers. 90% Qype revivers (2012), found Apple stores useful to get advices from trained staff members or to buy products. This is a part of physical evidences in marketing mix. (CIM, 2009) Apple in stores offers a Genius Bar where people are coming for pre-booked appointments and can receive help with their apple products (Apple, 2012). Apple customers found the Genius Bar useful, especially the opportunity to talk and see the staff members who helped to resolve their problems (Qype, 2010). This could be an improvement of Nintendo service, especially for people who are not computer efficient or prefer to talk in person. This relates to the people in the extended marketing mix. (Willson, Gilligan, 2005) Nintendo could improve their service by introducing online sales of their consoles. According to Epinionss website (2012), 90% of reviewers found Dells online service useful and helpful. Customers can order what they wanted without leaving houses and they can personalise it. This is described as a process management in 7 ps by Berry (1987)

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

5. Conclusions
This report has shown the main aspects of a distribution channel and a chain supply. It has identified how the worldwide leader in gaming industry- Nintendo is delivering the product from the producer to the customers. In addition to that, this report identified that the service which the company offers to its customers is running well and only minor changes could be made to improve consumers satisfaction. (878 Words)

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Malwina Mroczkowska-11724911, Group I Marketing & Business Operations Module Part D-Place & Service

6. Bibliography
Apple. (2012). Got a technical question? Step up to the Genius Bar. Available: [online] http://www.apple.com/retail/geniusbar/. Last accessed 4th Feb 2012. Baines P. Fill C. Page K. (2008). Marketing. Oxford: Oxford University Press. Baker M. (1990). The Macmillan Dictionary of Marketing and Advertising. Macmillan Publishers. CIM. (2009). How to achieve an effective marketing mix. 10 Minute Guide. 14280 (1), p. 6. Chopra S. Meindl P. (2001). Supply Chain Management: Strategy, Planning, and Operations. New York: Upper Saddle River. Chapter 1 Christopher M. (2005). Logistics and Supply Chain Management. Harlow: Pearson Education. p.123 Dell Business Online Store review. (1999-2012). Available: [online] http://www.epinions.com/webs-Web_Services-All-MerchantsDell_Business/sec_~opinion_list/sb_~1/display_~reviews/pp_~1/sort_~date/sort_dir_~asc#li st. Last accessed 12th Feb 2012. Gerth D. (N.D). Unit 13: Channels of Distribution, Logistics, and Wholesaling. Available: [online] http://ww2.nscc.edu/gerth_d/MKT2220000/Lecture_Notes/unit13.htm. Last accessed 21st Jan 2012. Hugos M. (2006). Essentials of Supply Chain Management. 2nd ed. New Jersey : John Wiley & Sons Inc. Chapter 1. Industry Overview. (N.D.). Available: [online] http://www.obscure.co.uk/articles-2/industryoverview/. Last accessed 13th Mar 2012. Jam M. (2009). AMD Ships 50 Million ATI 'Hollywood' Wii GPUs. Available: [online] http://www.tomshardware.com/news/amd-ati-hollywood-nintendo-wii,7249.html. Last accessed 24th Jan 2012. Moats B. (2008). Nintendo Wii Marketing Plan for Marketing Management. Available: [online] http://brianmoats.com/Portfolio/Nintendo_Wii_Marketing_Plan.pdf. Last accessed 29th Jan 2012. Nintendo. (2010). Buy your Wii Console at the following retailers. Available: [online] http://www.nintendo.co.uk/NOE/en_GB/where_to_buy.html?HW_Wii. Last accessed 24th Jan 2012. Nintendo. (2011). Nintendo Annual Report 2011. Available: [online] http://www.nintendo.com/corp/annual_report.jsp . Last accessed 29th Jan 2012.

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Nintendo. (2012). International Distributors-Company List. Available: [online] http://www.nintendo.com/corp/distributors_international.jsp#nuk. Last accessed 29th Jan 2012. Nintendo service centre-Portsmouth. (N.D.). Available: [online] http://www.misterwhat.co.uk/company/2134136-nintendo-service-centre-portsmouth. Last accessed 13th Mar 2012. Qype. (2010). Apple Store Birmingham. Available: [online] http://www.qype.co.uk/place/56436-Apple-Store-Birmingham. Last accessed 4th Feb 2012. Peter D. (2011). How Nintendo is Doing in Japan and What You Can Do to Help. Available: http://www.3dsbuzz.com/how-nintendo-is-doing-in-japan-and-what-you-can-do-to-help/. Last accessed 13th Mar 2012. Raby M. (2006). IBM ships Broadway CPU for Nintendo Wii console. Available: [online] http://www.tomshardware.com/news/ibm-ships-wii-processor,3424.html. Last accessed 24th Jan 2012. Roetting M et al.. (2010). Video Game System Industry Analysis. Available: [online] http://www.google.com/url?sa=t&rct=j&q=supply+chain+chart+nintendo&source=web&cd= 1&ved=0CCUQFjAA&url=http%3A%2F%2Fwww.nku.edu%2F~fordmw%2Fmgt490projec tvidgames%2520mfcomments.docx&ei=8GIlT_HdLajL0QXih. Last accessed 29th Jan 2012. Shilov A. (2006). Nintendo Wii Costs About $160 to Manufacture Report. Available: [online] http://www.xbitlabs.com/news/multimedia/display/20061215092033.html. Last accessed 24th Jan 2012 Wilson R., Gilligan C. (2005). Strategic Marketing Management: Planning, Implementation and Control. 3rd ed. Oxford: Elsevier Butterworth Heinemann. p. 531, p. 534-536. Winata P. (2009). Nintendo Wii. Available: [online] http://www.slideshare.net/peewegal/nintendo-wii-2645887. Last accessed 29th Jan 2012.

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