MANAGING RETAILING,
WHOLESALING, AND LOGISTICS
04-BHATT HARSHIL
08-DESAI SHREEL
09-DESAI TEJAS
21-MULLA HASNAIN
34-RAMNANI KHUSHBU
37-RAULJI YUVRAJ
MARKETING CHANNEL
A marketing channel is a set of practices or
activities necessary to transfer the ownership of
goods from the point of production to the point of
consumption.
It is the way products and services get to the enduser, the consumer; and is also known as a
distribution channel.
CONSUMER MARKETING CHANNELS
DELL
ONLINE
SALES
ECOMMERCE
PORTALS
FMCG MARKET &
CONSUMER DURABLES
WHAT IS RETAILING?
Retailing includes all the activities involved in
selling goods or services directly to final
consumers for personal, non business use.
A Retailer or Retail Store is any business
enterprise whose sales volume comes primarily
from retailing.
Any organization selling to final customers be it
a manufacturer, wholesaler or retailer is doing
retailing
MAJOR RETAILER TYPES
MAJOR RETAILER TYPES
Specialty store
Department store
Several product line (Shoppers Stop)
Supermarket
Narrow product line (Tanishq)
Large, Low cost, high volume, self serve (Hyper
CITY)
Convenience store
Small store in residence open 24/7
MAJOR RETAILER TYPES
Discount store
Off-price retailer
Leftover goods, overruns; factory outlets
Superstore
Low price, low margin, high volume (D-mart)
Huge selling place FMCG + Services + hypermarket
Catalog showroom
Goods sold by catalogue at discount
LEVELS OF RETAIL SERVICE
Self-service
Self-selection
Limited service
Full service
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NON STORE RETAILING
Direct Selling/ Network Marketing
Direct Marketing
Direct-mails and catalogue marketing
Telemarketing, electronic shopping
Automatic vending
Door-to-door or at home sale parties.
E.g. Avon, Amway, Eureka Forbes
Goods like soft drinks, coffee, candy, newspaper , food,
paper bags etc. catered via vending machines
Buying Service
Store less retailer serving specific clientele- usually
employee of large organizations
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MILK VENDING MACHINE
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MAJOR TYPES OF CORPORATE
RETAIL ORGANIZATIONS
Corporate chain store
Voluntary chain
Two or more outlets owned and controlled, employing
central buying and merchandise e.g. Reliance Mart
A wholesaler-sponsored group of independent
retailers engaged in bulk buying and common
merchandising
Retailer cooperative
Independent retailers using central buying
organization and joint promotion efforts
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MAJOR TYPES OF CORPORATE
RETAIL ORGANIZATIONS
Consumer cooperative
Franchise organization
Retail firm owned by its customers
Contractual association between franchisor and
franchisee e.g. Mc Donald's, Pizza Hut, Subway etc.
Merchandising conglomerate
Corporate that combines several diversified retailing
lines and forms central ownership e.g. Future group
with retail brands like Pantaloons, Central, Big
Bazaar, Food Bazaar, e-zone, etc.
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WHAT IS A FRANCHISING SYSTEM?
A franchising system is a system of individual
franchisees, a tightly knit group of enterprises
whose systematic operations are planned,
directed, and controlled by the operations
franchisor.
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CHARACTERISTICS OF FRANCHISES
The franchisor owns a trade or service mark and
licenses it to franchisees in return for royalty
payments
The franchisee pays for the right to be part of the
system
The franchisor provides its franchisees with a
system for doing business
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FRANCHISING SYSTEM IN INDIA
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NEW RETAIL FORMS AND COMBINATIONS
Combination retailers
Pop-ups
Showcase stores
RETAILERS MARKETING DECISIONS
Target market
Product assortment
Procurement
Prices
Services
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RETAILERS MARKETING DECISIONS
Store atmosphere
Store activities
Communications
Locations
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RETAILER SERVICES MIX
Prepurchase services
Post purchase services
Ancillary services
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PRIVATE LABELS
a brand created and owned by the producer of a
product or service
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TYPES OF PRIVATE LABEL
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PRIVATE LABEL BRANDS
Consumers accepts private labels
Private-label buyers come from all socioeconomic
strata
Private labels are not a recessionary phenomenon
Consumer loyalty shifts from manufacturers to
retailers
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WHOLESALING
Wholesaling excludes
manufacturers,
farmers, and retailers
Wholesalers differ
from retailers in three
key ways
Wholesalers handle
many functions more
efficiently than do
manufacturers
Wholesalers vary in
type and function
Wholesaling has been
growing due to two
key factors:
Many factories are
located far from
buyers
An increasing need to
adapt product
quantities, features, or
packages to meet
buyer needs
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WHOLESALING FUNCTIONS
Selling and promoting
Buying and
assortment building
Bulk breaking
Warehousing
Transportation
Financing
Risk bearing
Market information
Management services
and counseling
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MAJOR WHOLESALER TYPES
Merchant
Full-service
Limited-service
Brokers and
Agents
Manufacturers
Specialized
Independently owned
Carry stock, offer credit, make delivery
Cash and Carry, Producers Co-operative
Facilitate buying and selling, on
commission
Conducted by sellers or buyers
themselves
Agricultural assemblers, Petroleum bulk
planta and terminals, etc.
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MARKET LOGISTICS PLANNING
Deciding on the companys value proposition to
its customers
Deciding on the best channel design and network
strategy
Developing operational excellence
Implementing the solution
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MARKET LOGISTICS
Interrelated Aspects Associated with Market
Logistics:
Physical distribution
Supply chain management (SCM)
Value network
Demand chain planning
Market logistics
Integrated logistics systems (ILS)
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MARKET LOGISTICS
Market-logistics Objectives
Market-logistics Decisions
Order Processing
Order-to-payment cycle
Warehousing
Storage warehouses
Distribution warehouses
Automated warehouses
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INVENTORY
Inventory cost increases at an accelerating rate
as the customer service level approaches 100%
Order (reorder) point
Order-processing costs
Inventory-carrying costs
Just-In-Time production (JIT)
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OPTIMAL ORDER QUANTITY
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MARKET-LOGISTICS OBJECTIVES
Logistics involve trade-offs between costs and
customer service
Maximizing profits, not sales, is key
A total system basis should be considered
Designing a system that will minimize the cost of
achieving objectives should be the outcome
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CALCULATING THE COST OF
MARKET-LOGISTICS SYSTEMS
M = T + FW + VW+S
Where . . .
= total market-logistics cost of proposed system;
M
= total freight cost of proposed system;
T
FW = total fixed warehouse cost of proposed system;
VW = total variable warehouse cost of proposed
system
S
= total cost of lost sales due to average delivery
delay
It is hard to measure S, the company should aim to
minimize T + FW + VW for target level of customer
service
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WHAT ARE
INTEGRATED LOGISTICS SYSTEMS?
An integrated logistics
system (ILS) includes
materials
management, material
flow systems, and
physical distribution,
aided by information
technology.
REFERENCE
Kotler, Philip, and Kevin Keller. Marketing
Management. 13th ed. Prentice Hall, 2008.
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