distribution and retailing.rtf

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Western University
Management and Organizational Studies
Management and Organizational Studies 2320A/B
Dean Proessel

Distribution & Retailing Placement: asthelast Pof 4psanalysis, which weight heavily in B2B businessandhasalot to do with not only thephysical locaiton of thebusiness. How dothingsget to wherewe find them? Pricepoint, brands,andstyle etc.As marketersyou must understand, thelocation andplacement of your product anddistribution channel areimportant for retailer businessandfor customers. Distribution channels, supply chain andlogisticsarerelated Distribution channel consistsof instributinos, from manufacturesto theendcustmers, but we talk all thesectionsasdif fernt seperateinstutitions Supply chain management both distribution channel andlogisticsmanagement arepartsof supply chain management Logisticsmanagement Are about managing theactivitiesgoing onwithin andbetweeninstitutionsto makesureit flows andefficient Without anintermediary: aretailer must goto variety of brandandproductscompaniesto get the product availablefor thecustomers. Ex: 5brandsof TV, 4customers, 5*4=20 transaction However, with anintermediary, suchasbestbuy, canmakeit moreefficient andlesstimeconsumi ngfor both customersandproducers. 5producers+ 4customers=9transactions Contact efficient: provideaplacefor customersto get know all productsavailablein themarket p lace Distribution Components: Suupply chain (suppliersandsuppliersnetworks):suppliers, producers, consumers Distribution channels(wholesalers/retailers): from producersto consumers Both supplier chain anddistribution channelscombinedthelogisticsmanagement (flow of materi alsandinformation) 3key functionsperformedby intermediaries Transactional function Buying: purchasegoodsfro resaleto other intermediariesor consumers Risk taking: ownership or inventory that canbecomeoutdated Promotion: promoteproductsto attract consumers Selling: transact with potential customers Logistical function physical distribution: transport goodsto point of storing Facilitating function gather information, financing Distribution channel structure: direct & indirect Direct: manufacture--> consumer ex: onlinestores: Deil computersyou candirectly order from themanufacture,TigerDirect.com, Avon Indirect: Manufacturer-->Retailer-->Consumers ex: Amazon, Car Dealerships, Coca-Cola,basiclly retailer Indirect: manufacturer-->wholesaler-->retailer-->consumer ex: Cadbury, Frito Lay Multichannel strategy: Actually most commonusedby most markersin order to attract customersfrom morethanoneco mmunication(distribution) channels Manufacture-->retailer-->consumers Manufacture-->distributors-->dealers-->business Manufacture--catelogues,direct marketing-->consumers Manufacture--salesforce-->businesssegments In aB2B business,salesforcefrom themanufacturer deal directly with anther business. If thebu sinessdoesnot want alargequantity, they may chooseto deal with your dealersdirectly. If themanufacturersdoesnot haveastrongbrandawarenessamongcustomers, they will choosea intermediary who hasexisting customer baseandbetter recognized, andwork asaintermediary b etweenyou andyour customers. Distribution Intensit Product characteristicsdrivethechain structure. Intensive: zellers, loblaws, shoppers, walmart Selective: sears, bay Exclusive: Cartier, Tiffany & Co. Placeyour product basedonconsumer'sdeception of your product, thenatureof your product typ e,andyour brandstrategy ** recall: ConvenienceGoodsVS Shopping GoodsVS Speciality Goods Question: exclusivedistribution canbenefit manufacturesby assuring themthat: themost appropriatecusto mersbuy their product Channel Conflict Happenswhenmembersarenot in agreement about goals, roles,rewards. Weneedto managethepotential for conflict, typically through4ways. Concept: vertical marketing system -Supply chain wheremembersact in aunified system -which meansthetop player cancontrol all theother playersin thedistribution chain Typesof vertical marketing systems Independent or conventional supply chain: several independent memberswho act to satisfy their own objectives -most baseline Administeredvertical marketing system: nocommonownership or contractual relationship but th ereis adominant channel member who yieldsmorepower (e.g: walmart) -onestepupfrom independent or conventional supply chain Corporatevertical marketing system: parent company hascompletecontrol/ownership anddictate sobjectives(e.g: Zara) -control thedistribution chain Contractual vertical marketing system: independent channel membersenter into contractsto obtai neconomiesof scaleto reduceconflict -noonecontrol over eachother, but one'sperformancedoinfluencetheother'sperformanceandi sregulatedby alegal document Supply Chain Management Takescareof themovement of raw materials, theflow of information andhow eachpersonintera ct with eachother It is acircular process,onecomponent'sdisfunction would influencetheoverall process.So,the management of this supply chain is imporant, to makesureeverythign flows efficiently. ex: SAP: helping theflow of information, tracting goodsin areal timemanner. LogisticsManagement Management of inboundtransportation-->Receiving andchecking using UPCandRFID--> Storin gandcross-docking--> getting merchand
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