MGKT CHAPTER 13

A set of interdependent organizations that ease the transfer of ownership as products move from producer to business user or consumer.

• Specialization and division of labor
• Overcoming discrepancies
• Providing contact efficiency

The difference between the amount of product produced and the amount an end user wants to buy.

The lack of all the items a customer needs to receive full satisfaction from a product or products.

A situation that occurs when a product is produced but a customer is not ready to buy it.

The difference between the location of a producer and the location of widely scattered markets.

Retailer, Merchant Wholesaler, Agents and Brokers

• A channel intermediary that sells mainly to customers\
• They Take Title to Goods

An institution that buys goods from manufacturers, takes title to goods, stores them, and resells and ships them.

• Wholesaling intermediaries who facilitate the sale of a product by representing channel members.
• Do NOT Take Title to Goods

• Contacting/Promotion
• Negotiating
• Risk Taking
• done by Retailers

• Physically distributing
• Storing
• Sorting
• done by Wholesalers

• Researching
• Financing
• done by Agents and Brokers

The process of strategically managing the efficient flow and storage of raw materials, in-process inventory, and finished goods from point of origin to point of consumption.

A distribution channel in which producers sell directly to consumers.

• Direct
• Retail
• Wholesaler
• Agent/broker

• Direct
• Industrial
• Agent/broker
• Agent/broker industrial

• Multiple
• Nontraditional
• Strategic alliances

• Multiple channels
• Nontraditional channels
• Strategic channel alliances

• Market Factors
• Product Factors
• Producer Factors

• Arm’s Length Relationship
• Cooperative Relationship
• Integrated Relationship

• Fulfills a one time or unique need; low involvement/risk
• Parties unable to develop relationship; low trust level

• Formal contract without capital investment/long-term commitment; “happy medium”
• Some parties may need more relationship definition

• Closely bonded relationship; explicitly defined relationships
• High capital investment; any failure could affect every channel member

• A member of a marketing channel that exercises
• authority/power over the activities of other members

A clash of goals and methods between distribution channel members

The joint effort of all channel members to create a supply chain that serves customers and creates a competitive advantage

• Distribute directly or through foreign partners
• Legal and infrastructure differences