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Physical Distribution

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Angelo Punzalan

on 30 September 2012

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Transcript of Physical Distribution

Physical Distribution Galino, Paladin, Punzalan, Zuleta physical distribution is that marketing function which facilitates the movement of the goods from the manufacturer to the location of the ultimate users. Supplies Parts Raw Materials The Firm Warehouses Wholesalers Retailers Consumers Supply Chain Management physical distribution, in combination with marketing channels, comprise the total system perspective if distribution. Supply Chain Management Physical Distribution Marketing Channels Order Processing Inventory Control Warehousing Materials Handling Transportation Objectives of Physical Distribution To generate income by reducing costs and not by actual selling. Well Managed Physical Distribution 1.Improve customer service

2.Reduce distribution costs

3.Create time and place utilities

4.Stabilize prices

5.Influence channel decisions

6.Control shipping costs Physical Distribution Inventory planning
and control Transportation a.Railroads


c.Water vessels


e.Airplanes Forms of transportation Special transport agencies a. post office

b. freight forwarders Warehousing a.Private warehouses
b.Public warehouse 2 types Order processing a. order placement
b. internal order processing
c. order preparation
d. order shipment major components Materials handling a.To increase the usable capacity of the warehouse facility
b.To reduce the number of times goods are handled
c.To minimize the possibility of danger to people who are working around the warehouse
d.To reduce, if not eliminate, the monotonous and heavy manual labor aspect of short-distance movements in the warehouse.
e.To respond quickly and efficiently to customer’s orders Objectives of a material handling subsystem Thank You! When customers are satisfied with the service provided by the firm through an effective physical distribution system, they are motivated to patronize the firm. When the physical distribution system is effective, cost reduction is possible Producers are, sometimes, confronted by difficulties that may derail actions to achieve goals. These occur when production and consumption are imbalanced There are times when the market is flooded with an oversupply of a certain product. The effect is a drastic decrease in the price of the product. Sometimes, a firm’s management has to decide which channel to tap in the distribution of its products or services. When physical distribution activities are not functioning properly, the smooth flow of products from the company to the customers will not be possible. Maintaining an inventory of stocks is a requirement of physical distribution. Too much inventory, however, is a drain on the financial resources of the firm. This is an addition to the inventory and vice versa. warehousing is an important component of physical distribution. Due to some reasons, most products are not delivered to the customers right after they come out of the production line order processing refers to receiving, recording, filling, and assembling orders for shipment. The steps undertaken from the time the customers makes an order up to the time the ordered goods are delivered is called “order cycle”. Materials handling refers to the activities involved in moving goods over short distances into, within, and out of warehouses and manufacturing plants. Effective materials handling can be made to contribute to cost reduction and the effective flow of goods Customer Order Processing Transportation Storage Information System Inventory
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