Global Marketing Channels & Physical Distribution.

Channel objectives & constraints.

Channel Utility. o Place. o Time. o Form. o Information.

 Selecting the most effective channel

arrangement.
o Target market & determination of its needs & o o o o

preferences. Where are potential customers located? What are their information requirements? What are their preferences for service? How sensitive are they to price?

Channel strategy. o Direct involvement. Own sales force. Retail stores. o Indirect involvement. Independent agents, distributors, wholesalers.

 Company objective is constraint by several

factors.
o Customer characteristics.

Number, geographic distribution, income, shopping habits & reactions to different selling methods. Industrial product, Mass market product. o Product characteristics. Degree of standardization, perish ability, bulk, service requirements & unit price. o Middleman characteristics. Middleman are in business to maximize their own product. Reluctance in building a market for new product. Distributive incentive.

 Selection & care of distributors & agents. Zero performance v/s excellent performance. Sourcing the information from local chamber of commerce. Talk to end users of the products. Agents / Distributor performance. Quality of agents. Quality of product. Margins offered.
Termination. Clauses on performance & cancellation. Legal adversity. You should be able to read & understand the agreement.

o Environmental characteristics.

Economic, social, political environment.

Distribution channels terminology & structure.

Consumer products. o Door to door selling. o Manufacturers own stores. o Franchise operations. o Combination.

Marketing channel alternatives Consumer products.

M Manufacturers own retail outlet M Agents Brokers M MSF M MSF M MSF M

Door to Door

Mail Order

Part time Sales person

House Party

Customer

M=Manufacturer MSF=Manufacturer sales force

Industrial products Channel alternatives.

M M M

MSF

D or A

Customer M=Manufacturer MSF=Manufacturer sales force W=Wholesaler D or A=Distributor or Agent

Global retailing.
o o o o o

Hyper markets. Mass merchandisers. Discounters. Super markets. Super stores.

International channel innovation.

o Observations.

Innovation takes place only in the most highly developed systems. The ability of the system to successfully adapt innovations is directly related to economic development. Environmental constraints. Adaptation is greatly accelerated by aggressive individual firms.

Channel strategy for new market entry.

o Company must use established channels.

o Build its own channels.

o Provide special incentives to independent channel

agents. o Establishing direct distribution in a new market can also be expensive. o Expense of direct sales force acts as a deterrent to establish direct distribution.

Physical distribution & logistic. Physical distribution & logistic are the means by which products are made available to customers when & where they want them.
o Order processing.

o Ware housing.
o Inventory management. o Transportation.