Delivering Value: Distribution Strategies

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 1

Marketing Intermediaries
Wholesalers Retailers

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 2

Wholesalers and Retailers

Unity value Place Time Possession

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 3

Seven Roles of Wholesalers and Retailers

Match buyers and sellers Provide market information Provide promotional and sales support Gather an assortment of goods Transport and store products Assume risks and provide financing
Prentice Hall, 2007 Excellence in Business, 3e Chapter 14 - 4

How Intermediaries Simplify Commerce

Reduce prices Reduce contacts Create utility

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 5

Types of Wholesalers
Merchants
Full-Service

Agents or Brokers
Real Estate Agents

Rack Jobbers
Limited-Service Drop Shippers
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Securities Brokers
Insurance Brokers Manufacturers Reps
Excellence in Business, 3e Chapter 14 - 6

Customers of Retailers
Other retailers Wholesalers Organizations

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 7

Benefits of Retailers
Save time Save money Build traffic Add convenience

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 8

Types of Retail Stores

Specialty store Department store Category killer Discount store

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 9

Retail Industry Challenges

Excess store space
Weakened economy

Consumer preferences
Nonstore retailing

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 10

E-Commerce and Non-Store Formats

Clicks-only Internet
Clicks-and-bricks

Mail-order firms
Automatic vending Interactive kiosks

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 11

Retailing Innovations
Multichannel retailing Hybrid formats Retail theater Pop-up stores

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 12

Setting Distribution Strategies

Distribution mix
Kind of product being sold

Marketing practices of the industry

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 13

Length of Distribution Channels

Producer to consumer
Producer to retailer to consumer Producer to wholesaler to retailer to consumer Producer to agent/broker to wholesaler to retailer to consumer

Producer to business user

Producer to wholesaler to business user
Prentice Hall, 2007 Excellence in Business, 3e Chapter 14 - 14

Channel Selection
Market coverage Cost Control Channel conflict

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 15

Market Coverage
Distribution
Intensive

Selective
Exclusive

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 16

Market Coverage
Distribution
Intensive

Selective
Exclusive

Prentice Hall, 2007

Excellence in Business, 3e

Chapter 14 - 17

Cost Factors
Selling
Storage

Distribution

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Excellence in Business, 3e

Chapter 14 - 18

Control Issues
Distribution channels
Shorter

Longer
Overall control More Less
Prentice Hall, 2007 Excellence in Business, 3e Chapter 14 - 19

Channel Conflict
Inadequate product support
Too many intermediaries

Multiple sales channels

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Excellence in Business, 3e

Chapter 14 - 20

Managing Physical Distribution

In-house operations
Outbound transportation

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Excellence in Business, 3e

Chapter 14 - 21

In-House Operations
Forecasting Order processing Inventory control Warehousing Materials handling

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Excellence in Business, 3e

Chapter 14 - 22

Outbound Transportation
Rail Truck Water Air Pipeline

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Excellence in Business, 3e

Chapter 14 - 23