Textbook Notes (368,122)
Canada (161,660)
Commerce (1,690)
Chapter 11

Chapter 11 Textbook Notes.docx

4 Pages
Unlock Document

Stephen Charko

Chapter 11: Marketing Channels and Supply Chain Management • Distribution: movement of goods and services from producers to customers o Two critical components 1. Marketing (Distribution) Channel: system of marketing institutions that enhances the physical flow of goods and services, along with ownership title, from producer to consumer or business user 1. Logistics and Supply-Chain Management  Logistics: process of coordinating the flow of information, goods, and services among members of the distribution channel • Physical Distribution: broad range of activities aimed at efficient movement of finished goods from the end of the production line to the consumer • Customer Service • Inventory Control • Materials Handling • Protective Packaging • Order Processing • Warehousing  Supply-Chain Management: control of the activities of purchasing, processing, and delivery though which raw materials are transformed into products and made available to final consumers Marketing Channels… • Marketing Channels perform four important functions: 1. Facilitate the exchange process by reducing the number of marketplace contacts necessary to make a sale 1. Adjust discrepancies in the market's assortment of goods and services via a process known as sorting 1. Standardizing exchange transactions by setting expectations for products 1. Facilitate searches by both buyers and sellers • Types of Marketing Channels: o Direct Channel: marketing channel that moves goods directly from a producer to the business purchaser or ultimate user • Direct Selling: strategy designed to establish direct sales contact between producer and final user o Channels Using Marketing Intermediaries • Most channel options involve at least one marketing intermediary  Marketing Intermediary (Middleman): wholesaler or retailer that operate between producers and consumers or business users • Wholesaler: channel intermediary that takes title to the goods it handles and then distributes these goods to retailers, other distributors, or B2B customers  Producer to Wholesaler to Retailer to Consumer  Producer to Wholesaler to Business User i. Producer to Agent to Wholesaler to Retailer to Customer ii. Producer to Agent to Wholesaler to Business Unit • Manufacturers' Representative: agent wholesaling intermediary that represents manufacturers of related but noncompeting products and receives a commission on each sale i. Producer to Agent to Business User o Dual Distribution: network that moves products to a firm's target market through more than one marketing channel o Reverse Channel: channel designed to return goods to their producer Channel Strategy Decisions… • Selection of a Marketing Channel o Market Factors • Geographical location and size o Product Factors • Perishable foods or trendy products need short channels o Organizational and Competitive Factors • Companies with strong financial management and marketing resources may not need help from intermediaries as much as smaller firms do • Determining Distribution Intensity o Intensive Distribution: distribution of a product through all available channels o Selective Distribution: distribution of a product through a limited number of channels o Exclusive Distribution: distribution of a product through a single wholesaler or retailer in a specific geographic region • Presents potential legal problems i. Exclusive Dealing i. Market Restriction • Closed Sales Territories: exclusive geographic selling region of a distributor i. Tied Selling • Tying Agreements: an arrangement that requires a marketing intermediary to carry items other than those they want to sell • Who should perform channel functions? • Channel Management and Leadership o Channel Captain: dominant and controlling member of a marketing channel • Channel Conflict o Horizontal Conflict • Disagreements among channel members at the same level o Vertical Conflict • Disputes between channel
More Less

Related notes for COMMERCE 2MA3

Log In


Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.