Unit IV

Channel of distribution involve numerous interrelated variable that must be integrated into the total
marketing mix. Because of the time and money required to set up an efficient channel, and since channels are often
hard to change once they are set up, these decisions are critical to the success of the firm. The development and
management of channels of distribution and the process of goods distribution is complex, highly competitive and
specialized economic.

LEARNING OUTCOMES
At the end of the unit you will be able to:
1) Demonstrate an understanding between exchanges among intermediaries and the distribution functions.
2) Recognize that there are some differences among the marketers whether it is small, entrepreneurial venture
or a large company.

PRETEST
True or False
Direction: Answer the following questions, write True or False.

1. TRUE_ Some manufacturers use a direct channel.

2. TRUE_ Direct marketing increase the popularity of the marketers.
3. TRUE_ Channels with one or more intermediaries are referred to as indirect channels.
4. A manufacturer may attempts to gain expose through as many retailers.
5. TRUE_ Selective distribution limits the use of intermediaries.
6. Exclusive distribution wherein the manufacturer limits distribution.
7. TRUE_ When more indirect channels are used, the manufacturers must surrender some control.
8. TRUE_ Relationship marketing is defined as marketing with trust on customers.
9. TRUE_ Contractual systems involve independent production and distribution companies.
10. TRUE_ Administered vertical marketing systems are similar to conventional channels.

Thank you for answering the Pretest. I am expecting that you will do well in this test. The next section is the content
of this unit. Please read the content carefully.

LOGISTICAL FUNCTION

Assorting: Creating product assortments from several sources to serve customers. Storing: Assembling and protecting
products at a convenient location to offer better customer service.
Sorting: Purchasing in large quantities and breaking into smaller amounts desired by customers,
Transporting: Physically moving products to customers.

FACILITATING FUNCTION

Financing: Extending credit to customers.

Grading: Inspecting, testing, or judging products, and assigning them quality grades. Marketing Information and
Research: Providing information to customers and suppliers, including competitive conditions and trends.

Learning Activity: Reflection Paper / Discussion Questions

1. Activity 1: Reflection paper on the major functions performed in channels of distribution Explain each functions
briefly.

A distribution channel is a network of intermediaries that facilitates product delivery from the manufacturer
to the end consumer and transfers payments from the buyer to the producer. In other words, it is the route through
which a product travels from the production end to the point of consumption. A distribution channel is the path used
to get a product from the manufacturer or creator to the end user, In other words, how the customer gets their
product after purchase, which often include intermediaries. Distribution channels can be long or short, direct or
indirect. In general, the more complex, the higher the cost to both the business and consumers.

TRANSACTION FUNCTION- transactional functions are the activities associated with buying products and reselling
them, and the risks incurred in keeping the products in stock

LOGISTICAL FUNCTION-logistical functions include the assembling of a variety of products, storing them, sorting them
into appropriate categories and sizes, and arranging them on retail shelves.

FACILITATING FUNCTION- A facilitator plans, guides and manages a group event to meet its goals. To facilitate
effectively, you must be objective and focus on the group process." That is, the ways that groups work together to
perform tasks, make decisions and solve problems.

Activity 2: Explain each of the Distribution Coverage Required.

Activity 3: Write a short essay in Selecting Channels of Distribution. (Minimum of 100 words)

Marketing opportunities increase when a distributer categorizes customers in homogeneous groups with similar
needs and wants. Firstly, markets surveillance should help to identify various differences in customer needs in order
to successfully subdivide the market with an aim to offer customized products and services. Various factors
necessitating this categorization include age, gender, location geographical factors demographic characteristics, life
cycle, income or time pressure. A business must analyze the needs and wants of various customers before
determining its niche. My target market should consider the accessibility of the business and large enough to provide
a solid customer base. It should also consider the location and geographical factors. These will enhance time delivery
of the products and accessibility to the customers. In this market target, consideration of customer's sought benefit
will be of the highest interest The analysis of the market reveals that the target customers always seek benefits such
as convenience, time saving, cost, and independence from chores or buying. The customers in this market are
potential and frequent buyers. In addition, the survey shows that attitudes toward the products greatly shape the
development of a given brand. They desire distribution channels that provide timely delivery to ensure availability of
the product. Allow price, convenience, quality are some of the main factors that motivate the customers in market to
purchase the product. Knowing costumers needs and wants is basic to successful

Thank you for answering the learning activity. If you have a difficulty in accomplishing the action please send me a
message or via messenger or to our Google class. And now you are ready for the next assessment.