Distribution

Strategies
Chynne Pobadora
Mark Santiago
 Distribution Channel
Manufacturers do not sell their goods directly to
the consumers.The manufacturers have to link with
resellers or distributors or deliver them directly to
the retailers so that consumer can have access to
their products.
Functions of marketing intermediaries that especially benefit the
manufacturers:

Information provider- Marketing intermediaries gather and process information that is

A vital to understanding the market better. They can provide consumer insights to the
manufacturer that can help in offering better products.

B Product promotion- Marketing intermediaries specifically retailers, conduct

promotions and marketing efforts in order to encourage customers to patronize certain
products. This creates excitement and interest among consumers, which may later on
translate into increased sales of the manufacturer's goods.

C Physical distribution- Marketing intermediaries take care of physical distribution

and packaging goods for transport and at- home storage.
 Functions of marketing intermediaries that
especially benefit the consumer:
Matching demands and supplies- customers find almost everything
A they need at certain stores, whether it is a supermarket, a department
store, or a bookstore.
Merchandising- market intermediaries take care of physically
B arranging goods so it will be convenient for the customers to shop
for what they need.
Sales promotion- customers enjoy sales promotions and other
C marketing efforts from time to time, which may focus on just a few
products or all of the products in the retail store.
 Channel Levels
Distribution channels may have several
layers, and each layer is called Channel
Level. The number of intermediary levels
indicates the length of a channel.
Direct Channel

Has no intermediary levels

The company sells directly to

consumers
Indirect Channel

Contains one or more intermediaries

Supply Chain
Management
Supply Chain Management
Is the management of upstream and downstream value- added flows of
materials, final goods, and related information among suppliers, the company,
resellers, and final consumers. This involes Marketing Logistics or "planning,
implementing, and controlling the physical flow of goods, services, and related
information from points of origin to points of consumption to meet customer
requirements at a profit" (Kotler and Armstrong, 2014).

Supply chain management involves outbound, inbound, and reverse

logistics to create a customer- centered delivery network.
Outbound Logistics- moving
products from the manufacturer, to
the distributor, to the retailers and
then to consumers.

Inbound Logistics- moving materials

from suppliers to the manufacturer.

Reverse Logistics- reusing, recycling,

refurbishing or disposing of broken,
unwanted, or excess products
returned by customers or
distributors.
 Major Logistics
Functions
Companies need to manage their
logistics system effectively in order to
minimize costs while attaining their
objectives.
 Warehousing

Companies must make decisions on how to store their goods,for how

long, and how big of an area they need. Warehousing may involve
the use of storage warehouses used in storing goods for medium to
long periods, or distribution centers which are hubs for moving
goods rather than storing them.t
 Inventory Management

Proper inventory Management ensures that there are

enough stocks of goods given the demand for a period of
time. It ensures that when customers visit the store, the
goods that they need are properly stocked.
 Transportation
There are different types of transportation used in moving goods and
distributing services.
• Truck- highly flexible in routing and time schedules, and are efficient for
short haul of high- value merchandise.
•Railroads-in other countries, it is used to transport a large amount of bulk
products.
•Water carriers- a slow form of transportation and is used for nonperishable
goods.
•Pipelines- are used to move petroleum, natural gas and chemicals from
plants to the markets.
•Air carriers- are used when speed is needed or
distant markets have to be reached. Perishables and
high- value items are most frequently shipped via air
freight.
• Internet- moves digital products from anywhere in
the worldto the consumers.

Intermodal Transportation- if the company used

several modes of tranportation.
Retailing and Wholesaling

People go to a store to buy their needs such as

groceries, to shop for clothes, or to get
something to eat.
Retailing - includes all activities involved in selling
products or services to final consumers for their
personal or household use.
Retailers' Marketing Mix Decisions:

Product Decisions- the retailers must carefully select the

merchandise assortment they will carry in the store because items
that will not sell well will occupy precious shelf space without
contributing to sales.

Price Decision- the retailers price must suit its positioning,target

market, competition and economic factors.
Place Decision- the key in retailing is location. Retail
stores must be accessible to their target market, and
suit the image and positioning of the store.

Promotions Decision- to reach consumers, retailers may

we advertising,public relations, sales promotion and
personal selling in order to create awareness and
promote their products.
Types of retail operations

Amount of service

• Self- service retailers- customers pick up the items

themselves and proceed to the counter to pay.
•Limited- service retailers- provide more sales assistance
as they carry more shopping goods that customers need
information on.
•Full-service retailers- assist customers in every place of
the shopping process.
 Product lines

•Specialty stores- carry narrow product lines with deep

assortments within those lines.
•Department stores- carry a wide variety of product lines.
They usually carry products for men, women, and children, and
home and kitchen furnishings.
•Supermarkets- are large, low-cost/high-volume stores
designed to serve the customers need for groceries and
household products.
•Convenience stores- are relatively small stores that are
open 24/7 and carry high turnover convenience goods and
ready-to-go food. They have higher operating costs, which
result in slightly higher prices of goods.
•Superstores -are much bigger than regular supermarkets
and carry a large assortment of groceries, nonfood items,
and services.
•Service retailers -are stores whose main products are
services.
 Relative Prices
•Discount stores -carry standard merchandise with lower
margins and higher volumes.

• Off-price retailers - carry items at regular wholesale prices and

accept lower margins to keep prices down.
•Warehouse clubs - carry grocery items, appliances, clothing, and
othes goods at big discounts to members who pay annual
membership fees. They also carry imported goods that are not
available in other retail store formats.
 Green Retailing
As companies become more aware of their social
responsibility, more retailers nowadays adapt environmentally
sustainable practices. They promote enviromentally
responsible products (organic products or product that do not
use harmful chemicals in manufacturing or growing them),
create programs for the consumers to take part in the
advocacy (additionally points when you bring your own bag),
and are greening up operation practices with the use of
energy-efficient lights and appliances
 Wholesaling- includes all the activities involved in
selling goods and services for resale or business use or
for further processing.
Types of Wholesalers
The Merchant wholesalers provide a full line of
services,such as carrying stocks, maintaining a sales force,
offering credit, making deliveries and provinding
management assistance. Limited service wholesalers
offer fewer services than full service retailers.
Truckers- delivers goods to supermarkets, and
accepts payment for the delivery.
Brokers- facilitate buying and selling and assist in
negotiation, thereby, they do not carry inventory.
Agents- represent either buyers or sellers on a
more permanent basis, such as the manufacturers
agents or sales representatives.
Distribution
channel
decision
Choosing Intermediaries
Manufacturers need retailers, wholesalers, and other
intermediaries to distribute their goods to the final
consumers. Most established companies may not encounter
problems in choosing their intermediaries- they would
sometimes even turn down the retailers or distributors for
various reasons. New companies may have a harder time
finding intermediaries, especially if they have no prior
connections.
Motivating Intermediaries
Once a relationship has been with the intermediaries,
companies must maintain a good partnership with them. Long-
term partnerships are important in order to build trust,
confidence, and camaraderie between both parties.
In order to motivate the intermediaries to push the products
or give special concession, incentives may be given in the form of
trade discount, commission for sales personnel, or marketing
funds. Most companies now not only prioritize customer
relationship management efforts but partnership relationship
management as well.
International Distribution Channels
Distributing products in other countries is a great challenge for
companies. They must be able to adapt their channel strategies to
the existing structures within the country. Some countries may
have organized distribution channel; may be more challenging.

Companies distributing in global markets may be faced with

legal and political challenges as well. Differences in the legal
political environments must be studied carefully in order to make
strate
Thank You!!!
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 iscdunto ortses

-carry standard merchandise with

lower margins and higher volumes.
 Ortsessreup

-are much bigger than regular supermarkets and

carry a large assortment of groceries, nonfood
items, and services.
 gnisidcherman

- market intermediaries take care of physically arranging

goods so it will be convenient for the customers to shop
for what they need.
 Hysiplac rittisbionud

-Marketing intermediaries take care of physical

distribution and packaging goods for transport and at-
home storage.
 Aless oionmtopr

- customers enjoy sales promotions and other

marketing efforts from time to time, which may
focus on just a few products or all of the products
in the retail store.
 Tredic haclenn

Has no intermediary levels

 Trendiic haclenn

Contains one or more intermediaries

 Eeerrvs sctsgloii
- reusing, recycling, refurbishing or disposing of
broken, unwanted, or excess products returned by
customers or distributors.
 Doubnni sctsgloii
- moving materials from suppliers to
the manufacturer.
 Ortyvenni aangemment
ensures that there are enough stocks of goods given
the demand for a period of time. It ensures that when
customers visit the store, the goods that they need
are properly stocked.
Bonus for 5 points

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