Bus 464 - Final

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an organized network of agencies and institutions, which in combination, perform all the activities required to link producers with users to accomplish the marketing task
channel of distribution
movement of goods through channels
physical distribution
the management of distribution
provides the means to achieve distribution - made up of a coordinated group of individuals or firms that perform functions that ADD utility to a product or service
Channel objectives - name 4 utilities
time, place, information, form
availability of a product or service in a location that is convenient to a potential customer
place utility
availability of a product or service when desired by a customer
time utility
availability of the product processed, prepared, in proper condition, and /or ready to use
form utility
availability of answers to questions and general communication about useful product features or benefits
information utility
wholesale intermediary that typically carries product lines or brands on a selective basis
an intermediary who negotiates transactions b/t two or more parties but does not take title to the goods being purchased of sold
channels tend to be ________ as the number of customers served _________ and price per unit _________
longer / increased / decreases
individual customers market products to other individuals
peer - to - peer - Ebay helped Disney and IBM
usually low cost, mass market nondurable products / services - mature form in the US - popular in Japan
door to door selling
1/2 Japan's cars sold via door to door
what is the consumer version of the keiretsu system?
door to door selling
3 types of consumer channels
manufacturer owned stores; franchises; independent retailers
Disney planned to spend _______ million to open up _______ stores - what type of consumer channel are they?
300 / 600 - manufacturer owned
other examples: apple, Levi Strauss, Nike
establishes flagship retail stores as product showcases or means of obtaining marketing intelligence
manufacturer-owned consumer channel
Manufacturer-owned stores supplement, rather than replace, _______ through independent retail stores
For mass-market consumer products (ice cream, cigs, etc), what is required to achieve market coverage?
cannel linking manufacturer to distributor to retailer
Channel structure that has more intermediaries that seem necessary? irrational or rational?
rational - presents opportunity to gain competitive advantage through more effective channel arrangements
channel innovation that has grown in popularity - one manufacturer distributes product by utilizing another company's distribution channel
piggyback marketing
for piggyback marketing to work, the products must be....?
complementary / non-competitive / appeal to same customer
example of piggyback marketing
avon & mattel
for more expensive, complicated products that require explanation and applications, a company would use what type of sales force?
the _________ the market, the more feasible for manufacturer to use OWN sales force
the company establishes its own sales force or operates in own retail stores
direct involvement
the company utilizes independent agents, distributors, and /or wholesalers
indirect involvement
true/false: companies entering market for first time (usually foreign) should use local distributors
Working with Channel Intermediaries - 7 guidelines
1. select distributors - dont let them select you2. look for distributors willing and able to make investment necessary to achieve success3. treat local distributors as long-term partners4. support market entry by allowing proper mgmt., money, and marketing ideas5. maintain control over distributors6. make sure distributors provide detailed market and financial performance data7. build links on national basis
practice of accepting orders only from manufacturers with established demand for products/brands or selecting only specific items from vendor's product lines
cherry picking
global retailing
several departments, each representing distinct merchandise line with limited # sales people
department store
less variety that dept stores - narrower merchandise mix aimed at specialty target market - high level of service - clear and appealing value proposition
specialty stores
departmentalized, single-story retail establishments that offer variety of food and non-food items
- self serviced - 50K sq feet
same products as supermarkets - merchandise mix limited to high turnover and impulse purchases
15-20% higher prices- 30K sq feethigh traffic areas
convenience stores
all emphasize lower prices - "full line discounter": wide range of merchandise - limited service forman - 120K sq feet
discount stores - WALMART IS KING
customers "join" the club to take advantage of low prices on products displayed in shipping packages in "no frills" atmosphere
warehouse club
hybrid retailing format combining the discounter, supermarket, and warehouse club together
biggest - 200-300 sq feet
offer wide variety of aggressively priced grocery items plus general merchandise in space thats half size of hypermarket
important in walmart's expansion
specialize in particular product category - offers vast selection at low prices
"900 pound gorillas"
category killers - IKEA home depot
retail operations that let name brands dispose of excess inventory, out of date merchandise, factory seconds
outlet stores
environmental factors in global retailing - why do it?
home country saturation, recession, strict regulations, high operating costs
classifying global retailers
this quadrant is a global retailer with niche focus - use extensive ads and product innovation to create strong brand image
quadrant A - GAP, IKEA
this quadrant has private labels - must attract customers to both store and branded merchandise
Quadrant B - Marks & Spenser
this quadrant has many well known brands in a tightly defined merchandise range - includes category killers
Quadrant C - Toys R Us, Virgin Mobile
this quadrant offers same type of merchandise than other retail stores - competence is in distribution of some other value chain element
WALMART - quadrant D
Name the 4 global retailing strategies
organic, franchise, chain acquisition, joint venture
type of global retailing strategy - internal growth - uses own resources to open a store on a Greenfield site or acquire one or more existing retail facilities
type of global retailing strategy
appropriate when barriers to entry are low but market is culturally distant
type of global retailing strategy
a market entry strategy that entails purchasing a company with multiple existing outlets in a foreign country
chain acquisition
type of global retailing strategy
advisable when culturally distance, difficult-to-enter markets are targeted
joint venture
Where does innovation take place in global retailing?
most highly developed systems
ability of a system to successfully adapt innovations is directly related to its level of ________ ___________
economic development
The process of adaption can be greatly accelerated by the actions of _________ __________ ______.
aggressive individual firms
useful tool for accessing competence within a broader supply chain AND characterizes specified industry that firm participates in
value chain
includes ALL the firms that perform support activities by generating raw materials, converting them into components or finished products, and making them available to customers
supply chain
the management process that integrates the activities of all companies to ensure an efficient flow of goods through the supply chain
a firm that is removed from customer is _________ in value chain
a company that is relatively closer to customer is considered ________ in the value chain
shipping from manufacturers directly out to stores
drop ship
includes order entry, in which the order is actually entered into a company's information system; order handling which involves locating, assembling, and moving products into distribution and order delivery
order processing
used to either store goods or as distribution centers
designed to efficiently receive goods from suppliers, then fill orders for individual stores or customers - type of warehousing
distribution centers
ensures that a company neither runs out of manufacturing components or finished goods nor incurs the expense and risk of carrying excessive stocks of these items
inventory management - expensive!
the method or mode a company should utilize when moving products through domestic and global channels
easiest, most effective, reliable, most accessible
cost effective for moving large quantities long distances, less reliable than trucks, poor maintenance
2 types of water transport
inland: low cost / bulk shipping / slow
ocean: any product can be shipped - more cost effective - UNRELIABLE (approx 200 freighters sink due to bad weather)
combo of land and water shipping form producer to consumer
intermodal transportation
"achilles heel of global distributon"
shitty railway system in US
loading ocean-going freight into steel boxes

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