DISTRIBUTION

MANAGEMENT
M.A. ACIERTO, MBA, ET AL
Introduction
Distribution’s main a role is to provide link between production and the
target market. In today’s
Environment , the main question is who will pergorm this task and how it will
be executed given the new tools of technology and management.

 4 p’s marketing mix

 Place distribution
 Is a vital aspect of marketing
 Ensuring availability of products in the right quantity, time and place
 Important in international market due to distance transportation time
Place dist:

• Importers, manufacturers and retailers are increasingly asking for just

in time deliveries.
• Distribution strategy varies from market to market
• Is an integral part of sales
Distribution management
• Distribution planning
• Transportation
• Inventory management
• Customer transaction

Distribution channel- a medium by which goods and services are made

available
Distribution channel- performs the work of moving products from
manufacturers to ultimate /final consumers
DC- are essentially composed of marketing intermediaries ( persons or firms)
Marketing distribution channels can perform conducting research,etc.
Continuation:
Dist chan- set of interdependent organizations involved in the process of making a
product or service available for use or consumption
Dist cha- made up of people or organizations involved in the distribution process
Channel members – may either be manufacturers, service providers, wholesalers ,
retailers, marketing specialists or consumers.
Middlemen-act as go-between the product and the consumer.

Distribution channels under marketing services

 Use of ICT facilities
 Channel members:
 Manufacturers
 Service providers
Cont: channel members
• Wholesalers
• Retailers
• Marketing specialists
• Consumers

 The term middlemen refers to the ff:

 Wholesalers
 Retailers
 Marketing specialists
Basic types of distribution channels
• Direct channel: the transfer of goods and services from producer to
user without the intervention of independent middlemen. This is the
channel chosen by firms if they want control of the entire marketing
program.

• Indirect channel- the transfer of goods or services from

manufacturers to independent intermediaries to customer. This is
used by firms if they want to expand markets or users.
Intensity of channel coverage
• Exclusive distribution-using limited number of middlemen in a
geographic area
• Selective distribution- organizing a moderate number f wholesalers or
retailers, the chosen retailers are selected based on credibility
• Intensive distribution- using many middlemen to obtain widespread
market coverage
• Dual channels of distribution- using the mixture of the above to
appeal to different market segment
Physical distribution
• A broad range of activities primarily concerned with the efficient
movement of finished goods from the end of the production line to the
consumer. In some cases , it involves the movement of raw materials
from source to production line.
• It may include:
• Customer service
• Shipping
• Warehousing
• Inventory control
• Packaging
• Receiving materials handling
Transportation

• The ability of the organization to transport the available goods into the
customer custody.
• Basic forms:
• Railroads
• Motor carriers
• Waterways
• Pipelines
• Airways
• Kinds of service companies
• Government parcel post
• Containerization
• Freight forwarding
Categories of transportation firms
• Common carriers
• Contract carriers
• Exempt carriers
• Private carriers

• Inventory management
• (JIT) - just in time
• EDI- electronic date interchange
Warehousing- involves physical facilities
intended for storage of goods.
• Private ware house-owned , managed and operated by firms that
store, distribute their own products
• Public warehouse-provide storage , safekeeping of the inventory and
related physical distribution services to any interested firm
• Bonded warehousing- imported or taxable goods are stored
• Field warehousing- receipt is issued by a public warehouse for goods
or tangible products stored in public warehouse or in trnsit to
consumers.
Wholesaling

• Manufacturer wholesaling- manufacturer or producers control

wholesaling

• Merchant wholesaling- wholesaler controls wholesaling

• Agents and brokers- manufacturer owns products allows agent and

broker to sell products.
Retailing- bus activities involved in the sales of goods and services

• Functions:
• Involved in sorting process by collecting assorted goods and services
• Provides accurate information to consumers
• Marketing research regarding product features
• Stores merchandize and mark process

A. Types:
• Independent –operates only one outlet
• Retail chain
• Retail franchising
• Leased department
• Consumer cooperatives
B. Store strategy mix.
• Convenience store
• Conventional supermarket
• Superstore
• Combination store
• Specialty store
• Variety store
• Department store
• traditional
• full-line discount store
c. Non store operations
• Vending machines- coin or car operated machines
• Direct selling- personal contact with consumer in their homes
• Direct marketing- telemarketing

Store locations ( factors)

Accessibility to the market
Free from danger
Convenience to the supplier
Basic forms of store locations
• A. Isolated stores- no adjacent stores
• B. Unplanned business districts- two or more stores which are located
and close to each other
• Kinds:
Central business district- center retailing in the city
Secondary business district- found n the intersection of two major streets.
Neighborhood business district- supplies the needs of the neighborhood.
String- group of stores or shops with similar or comparable products
• C. planned shopping center -centrally owned and managed
Types of planned shopping centers
• Regional-sells mostly shopping goods to disperse /various customers
• Community-has a branch dept. store, variety stores, large specialty
store
• Neighborhood- sells convenient goods

• Scrambled merchandising- process of moving unrelated goods from

company to retailer
Distribution strategy
• Common distribution channels:
• Direct sale
• Original equipment manufacturer
• Manufacturer’s representative
• Wholesalers
• Brokers and distributors
• Retailers
• Direct mail