Distibution Channels
Session 7
DISTIBUTION CHANNELS
By the end of this unit, you should be able to:
• Explain why companies use distribution channels and discuss the functions these channels perform. • Discuss how channel members interact and how they organize to perform the work of the channel. • Identify the major channel alternatives open to a company. • Discuss the nature and importance of marketing logistics and supply chain management. • Describe the major types of retailers and give examples of each. • Identify the major types of wholesalers and give examples of each.
1. WHAT ARE THE DISTRIBUTION (PLACE) DECISIONS FOR EFFECTIVE MARKETING MANAGEMENT?
2. The Nature of Distribution Channels a. A distribution channel is a set of interdependent organizations involved in the process of making a product or service available for use or consumption by the consumer or business user. Why Are Marketing Intermediaries Used? b. The use of intermediaries results from their greater efficiency in making goods available to target markets. Through their contacts, experience, specialization, and scale of operation, intermediaries usually offer the firm more than it can achieve on its own. Distribution Channel Functions c. Members of the marketing channel perform many key functions. They are: 1). Information gathering and distribution. 2). Promotion. 3). Contact with prospective buyers. 4). Matching—buyers with sellers. 5). Negotiation so ownership can take place. 6). Others include: a). Physical distribution (such as transportation and storage). b). Financing. c). Risk taking. Number of Channel Levels d. Distribution channels can be described by the number of channel levels involved. A channel level is a layer of middlemen
DISTIBUTION CHANNELS
By the end of this unit, you should be able to:
• Explain why companies use distribution channels and discuss the functions these channels perform. • Discuss how channel members interact and how they organize to perform the work of the channel. • Identify the major channel alternatives open to a company. • Discuss the nature and importance of marketing logistics and supply chain management. • Describe the major types of retailers and give examples of each. • Identify the major types of wholesalers and give examples of each.
1. WHAT ARE THE DISTRIBUTION (PLACE) DECISIONS FOR EFFECTIVE MARKETING MANAGEMENT?
2. The Nature of Distribution Channels a. A distribution channel is a set of interdependent organizations involved in the process of making a product or service available for use or consumption by the consumer or business user. Why Are Marketing Intermediaries Used? b. The use of intermediaries results from their greater efficiency in making goods available to target markets. Through their contacts, experience, specialization, and scale of operation, intermediaries usually offer the firm more than it can achieve on its own. Distribution Channel Functions c. Members of the marketing channel perform many key functions. They are: 1). Information gathering and distribution. 2). Promotion. 3). Contact with prospective buyers. 4). Matching—buyers with sellers. 5). Negotiation so ownership can take place. 6). Others include: a). Physical distribution (such as transportation and storage). b). Financing. c). Risk taking. Number of Channel Levels d. Distribution channels can be described by the number of channel levels involved. A channel level is a layer of middlemen