An overview of distribution management

Extract

[...] They store manufacturer brands they provide little service post prices on shelves locate in secondary sites customers pack their own groceries their prices are much less than supermarkets brand continuity does not exist since products are brought in and as when conditions General Merchandise Retailers They could be classified as follows Specialty store Traditional departmental store Full line discount store Variety store Off price chain Factory outlet Membership clubs Flea Markets Specialty Stores They generally sell one good/ service line Though the merchandise carried is narrow it is deep in assortment, suitable to meeting the selective target market Helps in having better assortments than competitors Sales expertise is better than competition Improves control on investments & have flexibility Eg Weekender clothing Killer Category/ Power retailer is a large specialty store which has a large collection/ selection in its product category & relatively low priced eg Arvind Mills Mega Mart Disadvantages Seasonality/ or fall in demand for the product because of is popularity One stop shoppers looking for multiple product categories may not visit these places Traditional Departmental Stores Is a store with an extensive assortment of goods/ services that is organized into separate departments for purpose of buying, promotion, customer service & control. [...]

[...] Closing Gaps Demand-side gaps Offer tiered service Expand-contract provision of service outputs Channel segment targeted Supply-side gaps Change flow responsibilities of current channel members Invest in new low-cost distribution Bring in new channel members Indicative bibliography proposed by Oboulo.com http://eaglenet.lambuth.edu/facultyweb/faculty/Business/halters/berman_rm10_ppt_05.ppt http://www.manh.com/distribution_management/index.html http://www.mdm.com/ An overview of distribution management Introduction Distribution management is a factor of the channels of distribution which is also known as marketing channels. A marketing channel is a set of interdependent organizations involved in the process of making a product or service available for consumption A marketing channel is a strategic asset of any organization and the success or failure of the organization predominantly dependent on it Marketing channels can be Physical structure based Non physical structure based Introduction A marketing channel is more than a conduit for products or services it is also a means of adding value to the products or services These value added services are called service outputs which are created by the channel members & consumed by end users Factors influencing marketing channels Two important factors influence the marketing channels Demand driven factors Facilitation of search Adjustment of assortment discrepancy Sorting out Ex Various types of toiletries Accumulation Ex Procurement for various manufacturers Allocation Ex Breaking down standard packing Assorting Ex Making of the product mix Factors influencing marketing channels Supply driven factors Routinization of transactions like terms of sale, EDI, Continuous replenishment program (CRP) Reduction in number of contacts To ensure maintenance of all exchanges Easy to have control of the channel Should ensure no escalation in costs by ensuring the reduced number of contacts have higher efficiencies than the numbers reduced by Helps in market coverage Help reduce cost of channel maintenance Flows of the marketing channel The word flows has been used because the activities in a marketing channel move in a predetermined way. [...]

[...] Closing Gaps Demand-side gaps Offer tiered service Expand-contract provision of service outputs Channel segment targeted Supply-side gaps Change flow responsibilities of current channel members Invest in new low-cost distribution Bring in new channel members Indicative bibliography proposed by Oboulo.com http://eaglenet.lambuth.edu/facultyweb/faculty/Business/halters/berman_rm10_ppt_05.ppt http://www.manh.com/distribution_management/index.html http://www.mdm.com/ An overview of distribution management Introduction Distribution management is a factor of the channels of distribution which is also known as marketing channels. A marketing channel is a set of interdependent organizations involved in the process of making a product or service available for consumption A marketing channel is a strategic asset of any organization the success or failure predominantly dependent on it Marketing channels can be Physical structure based Non physical structure based Introduction A marketing channel is more than a conduit for products or services it is a also a means of adding value to the products or services These value added services are called as service outputs which are created by the channel members & consumed by end users Factors influencing marketing channels Two important factors influence the marketing channels Demand driven factors Facilitation of search Adjustment of assortment discrepancy Sorting out Ex Various types of toiletries Accumulation Ex Procurement for various manufacturers Allocation Ex Breaking down standard packing Assorting Ex Making of the product mix Factors influencing marketing channels Supply driven factors Routinization of transactions like terms of sale, EDI, Continuous replenishment program (CRP) Reduction in number of contacts To ensure maintenance of all exchanges Easy to have control of the channel Should ensure no escalation in costs by ensuring the reduced number of contacts have higher efficiencies than the numbers reduced by Helps in market coverage Help reduce cost of channel maintenance Flows of the marketing channel The word flows has been used because the activities in a marketing channel move in a predetermined way. [...]

[...] Closing Gaps Demand-side gaps Offer tiered service Expand-contract provision of service outputs Channel segment targeted Supply-side gaps Change flow responsibilities of current channel members Invest in new low-cost distribution Bring in new channel members Indicative bibliography proposed by Oboulo.com http://eaglenet.lambuth.edu/facultyweb/faculty/Business/halters/berman_rm10_ppt_05.ppt http://www.manh.com/distribution_management/index.html http://www.mdm.com/ An overview of distribution management Introduction Distribution management is a factor of the channels of distribution which is also known as marketing channels. A marketing channel is a set of interdependent organizations involved in the process of making a product or service available for consumption A marketing channel is a strategic asset of any organization and the success or failure of the organization predominantly dependent on it Marketing channels can be Physical structure based Non physical structure based Introduction A marketing channel is more than a conduit for products or services it is also a means of adding value to the products or services These value added services are called as service outputs which are created by the channel members & consumed by end users Factors influencing marketing channels Two important factors influence the marketing channels Demand driven factors Facilitation of search Adjustment of assortment discrepancy Sorting out Ex Various types of toiletries Accumulation Ex Procurement for various manufacturers Allocation Ex Breaking down standard packing Assorting Ex Making of the product mix Factors influencing marketing channels Supply driven factors Routinization of transactions like terms of sale, EDI, Continuous replenishment program (CRP) Reduction in number of contacts To ensure maintenance of all exchanges Easy to have control of the channel Should ensure no escalation in costs by ensuring the reduced number of contacts have higher efficiencies than the numbers reduced by Helps in market coverage Help reduce cost of channel maintenance Flows of the marketing channel The word flows has been used because the activities in a marketing channel move in a predetermined way. [...]

[...] They are performing the following functions: Physical possession Ownership functions Financial functions Alternate channel formats Manufacture based channel formats Manufacture direct: Here the products are sold by the company's sales force the products are shipped from the company's warehouse ex Eureka Forbes Manufacture owned full service wholesale distributor Herein the a distribution company is acquired by a company to serve the sales of their products & also sell other company's products if there is a demand for the same Ex Showrooms of Clothing apparel products Company store manufacture outlet These are outlets located in high density areas to liquidate seconds Ex Mega marts License Here the distribution & marketing activities are licensed to an external source & could be for a lock in period Ex Mattel Toys, Walt Disney Consignment- Locker stock i.e., on consignment basis where ownership titles are passed on only after the consumption of the product/ service Broker or agents Alternate channel formats Retailer based formats Franchise Ex McDonald's Dealer direct Ex Advaith Hyundai Buying club Ex CD libraries, book libraries Warehouse - wholesale club Ex discount stores with no frills attachment Ex bargains on Com Street Mail-order catalog Food retailer Ex Food World Department Store Ex Bangalore Central Mass Merchandiser Ex Metro Specialty store Ex Music World Specialty discounter- category killer Ex Mega Mart Convenience stores Hyper market Ex Family Bazaar Alternate channel formats Service Provider based channel formats Contract warehousing Public storage facilities provided at a fee Sub processor Part of the process is outsourced Cross Ducking On the basis of the orders from the company the trucking companies haul the requirements & delivers the same to the customers Integration of truck & rail ( Intermodal) Roller freight Same as Cross Ducking but drivers are routed with the help of satellite communication Stack train & Road Railer Scheduled train Outsourcing Direct mailer Bartering VAR Influencer- specifier Financial service provider Other Channel Formats Door to Door Format Individual on site Route Home party MLM Service merchandising Rack Jobbing Similar to a route except that route used to have essentials but here one has the options of all types of products or services Other Channel Formats Buyer initiated formats Co-operative Dealer owned Co-op Buying group Other Channel Formats Point of consumption merchandising format Vending Kiosk Pay per service point of dispensing Computer access information Other Channel Formats Third party influencer formats Charity Company sponsored programs Premium & gift market Product mail with normal correspondence Customer list cross selling Other Channel Formats Catalog & technology aided formats Specialty catalog B2B catalog Television home shopping & satellite networks Interactive merchandising Third party catalog service Trade shows Database marketing RetailingFrench word “retailler”meaning to cut up Why study retailing?a) The impact of retailing on the economyb) Retail functions in distributionc) Relationship among retailers & suppliersd) Career opportunities in retailing FUNCTIONS IN DISTRIBUTIONRetailer is the last link between manufacturers, wholesalers, suppliers & consumers. [...]