MKTG2238 Chapter 19: MKTG2238 CHAP 19 PART 1
Document Summary
Topic fourteen: sales promotion overview & trade promotions (chapter 19) Major forms of trade allowances: off-invoice allowances. Deals offered to trade that permit wholesalers & retailers to deduct a fixed amount from the invoice. Retailers may not pass along discounts to consumers: bill-back allowances. Retailers receive allowances for featuring the manufacturer"s brand in ads / for providing special displays: slotting allowances. Fees that manufacturers pay retailers for access to the slot / location. Fees paid by a manufacturer to get its new brand accepted by retailers: exit fees (deslotting allowances) If brand doesn"t meet average weekly sales volume >> retailer can assess a deslotting charge for removing the item from its distribution center. Undesirable consequences of off-invoice allowances: forward buying. Retailers purchase enough products on deal to carry them over until manufacturer"s next regularly scheduled deal. Retailers" savings from forward buying often are not passed on to consumers: diverting. Occurs when manufacturer restricts a deal to a limited geographical area.
