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Distribution and Supply Chain - Chapter 10! :)
Transcript of Distribution and Supply Chain - Chapter 10! :)
s' role in marketing channel
Marketing channel structure
Logistic and Supply Chain Management
helps get the right amount of the right products to the right place at the right time at the lowest possible cost.
Vertical marketing system
Key Logistics Functions in a Supply Chain
Channel Choice and Management
Factors Affecting Channel Choice
Geographic concentration of the market:
Concentrated in a few areas = direct sale is practical.
Geographically dispersed = direct sale is likely to be
impractical due to high travel costs
Sellers may establish:
Sales branches in densely populated markets and;
Use intermediaries in less-concentrated markets.
Numbers of potential customers:
Few potential customers
Use its own sales force
to sell directly to ultimate
customers or business users.
Larger number of customers
Tim Hortons has 4,288 systemwide restaurants, including 3,453 in Canada, 808 in the United States and 27 in the Gulf Cooperation Council.
Acessed July 28, 2013.
For a larger number of customers, the manufacturer would probably use intermediaries (franchisee).
Type of market:
Consumers products = retailers or;
Business products = direct or intermediaries.
Direct distribution = order size is large (large grocery chains).
Do not justify a direct sale = small independent grocery and convenience stores.
Highly sophisticated products = direct to buyers.
Pre-purchase and pos-purchase service;
Typically wholesalers do not do these task.
Some goods such as milk and bread fairly quickly.
Products go directly from the producer to the retailer,
no matter the size of the order
"The price attached to each unit of a product affects the amount of funds available for distribution"
Bombardier - Can afford to use its own employees to sell aircrafts.
Hershey Canada - Convenience stores, vending machines and gasoline service stations (
low unit-value products
Product life cycle:
Products such as Apple iPod become very popular, easy to operate, and available in more mainstream channels.
Financial resources and ability of management.
Limited financial resources or no know-how = use intermediaries (selling agents or manufacturer's agents).
Desire for channel control:
Direct control = control their product's distribution (
may be more costly
Gap Inc. assures
its more than
3,000 Gap stores.
: Marketed properly and
Channel Design Considerations
Target Market Coverage
retailers (as many as possible)
There are 1.7 billion servings of Coca-Cola sold every day, according to our 2010 annual report.
Yatchs and more.
Satisfying Buyer Requirements
Pre-and / or Post-Sale Services
Revenues earned minus cost for each channel.
of channel profitability.
Channel Relationships: Conflict and Cooperation
Conflict in Marketing Channels
Cooperation in Marketing Channels
Supports other channel members
Cost-effective organization of the: flow of raw materials, in-process inventory,
finished goods, and related information:
Point of origin
Point of consumption
Satisfy customer requirements
Supply Chain versus Marketing Channels
Raw materials and finished goods
Includes suppliers plus wholesalers and retailers
Focus on retailers
Supply Chain Management
Integration and organization of information
and logistics activities
Creating and delivering goods and services
Provide value to consumers
How distribution channel works:
The automotive supply chain
Supply Chain Management
and Marketing Strategy
Goals of marketing strategy determine the management focus of the supply chain
In order to align the strategies, you need to:
Understand customer segment needs
Understand the supply chain
Harmonize the supply chain with marketing strategy
Harmonizing the Supply Chain and Marketing Strategy
Dell Computer Corporation --> Responsive supply chain
Wal-Mart --> Efficient supply chain
What is marketing channel ?
the set of individuals or firms involved in the process of marketing a product available
Make the flow of goods from producer to consumer through intermediaries
6 kinds of intermediaries
How to create value
3 function of intermediaries
5 benefits for consumer
2 types of marketing channel
Electronic marketing channel
What is it ?
dual presence ofmarketing channel
traditional ( face to face )
e - marketing ( online )
market environment is changing...
2 roles of multichannel marketing
Benefits for consumer
brows & buy
(anytime, anywhere, &any way)
cross channel shop
- get many information
Global channel strategy
what is it ?
3 types of vertical marketing
- contractual : 3 variation
4 types of
Victor & Yukari
- Intermediaries' role in marketing channel
- Channel structures
- Multichannel marketing
- Vertical marketing
- Channel choice & management
- Logistic & supply chain management
- Key logistics function in a supply chain
agent / broker
professionally managed & centrally coordinated marketing channels designed to achieve channel economies & maximum marketing impact
# wholesaler sponsored voluntary chains
# retailer sponsored cooperatives
# franchise program
- manufacture sponsored retail F.S
- manufacture sponsored wholesale F.S
- retail F.S
- service F.S
What do you want to buy ?
Eletronic data interchange (EDI)
The use of EDI increases the speed, accuracy and operations between retailer and supplier.
Just-in-time (JIT) inventory system
I didn't forget the
1. Channel conflict
4. Exclusive distribution
5. Intensive distribution
8. Selective distribution
9. Supply chain
10. Supply chain management
we have intermediary !!
expensive...too much time...
& dual distribution
1, cross channel shopper
2, dual distribution
3, electronic marketing channel
6, marketing channel
7, multichannel marketing
8, vertical marketing systems