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Mail-order wholesalers
Rack jobbers
MERCHANDISE AGENTS OR BROKERS
Manufacturers reps
Selling agents
Commission merchants
Merchandise brokers
MANUFACTURER-OWNED
INTERMEDIARIES
Sales branches are manufacturer-owned
facilities that carry inventory and provide sales
and service to customers in a specific geographic
area.
Sales offices are manufacturer-owned facilities
that do not carry inventory but provide selling
functions in a geographic area.
Manufacturers showrooms are manufacturer-
owned or leased facilities in which products are
permanently displayed for customers to visit
OBJECTIVE 4
Describe the Types of Distribution Channels and
How Place Fits in With the Other Three Ps in the
Marketing Mix
TYPES OF DISTRIBUTION CHANNELS
Consumer Channels
B2B Channels
Step 4
Step 1
Step 3
Step 2
Environme Develop
Distribut Distribut Distributio
ntal
ion Influences ion n Tactics
Objective Strategy
s
Channel Strategies
Conventional Vertical Marketing System
PRODUCER PRODUCER
WHOLESALER
WHOLESALER
RETAILER
RETAILER
CONSUMER CONSUMER
CORPORATE VMS
CONTRACTUAL VMS
RETAILER CO-OP
FRANCHISE ORGANIZATION
Distribution Intensity
Few Many
Number of
Outlets
resources.
Legitimate power if it has legal authority to call
the shots.
Reward or coercive power if it engages in
PURCHASING
MANUFACTURING
STORAGE
TRANSPORTATION
LOGISTICS FUNCTIONS
ORDER PROCESSING
WAREHOUSING
MATERIALS HANDLING
TRANSPORTATION
INVENTORY CONTROL
TRANSPORTATION ATTRIBUTES
DEPENDABILITY
COST
DELIVERY TIME
VARIETY OF PRODUCTS
TRACEABILITY
MODES OF TRANSPORTATION
AND USAGE
Railroads: heavy, bulky items over long
distances
Water: large, bulky goods (especially
internationally)
Trucks: consumer goods in short haul; allow
flexibility in locations
Air: high value-items; fastest and most expensive
mode
Pipelines: petroleum/chemical products
Internet: services such as banking, news, and
entertainment
INVENTORY CONTROL
Firms store goods for many reasons, such as
enabling production to meet seasonal demand
and creating economies in ordering.
Some companies are phasing in a sophisticated
technology known as radio-frequency
identification (RFID), which lets them tag
products with tiny chips containing information
about the items content, origin, and destination.