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Chapter 1-Distribution Management and The Marketing Mix

The document discusses distribution management, which involves overseeing the movement of goods from suppliers to consumers, ensuring efficiency in delivering products. It highlights the importance of distribution channels, both direct and indirect, and the roles of intermediaries in facilitating the transfer of ownership and reducing costs. Additionally, it outlines the functions of distribution strategies, emphasizing the need for effective logistics and market intelligence to enhance competitiveness.

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Ruby Ann Estrella
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0 views34 pages

Chapter 1-Distribution Management and The Marketing Mix

The document discusses distribution management, which involves overseeing the movement of goods from suppliers to consumers, ensuring efficiency in delivering products. It highlights the importance of distribution channels, both direct and indirect, and the roles of intermediaries in facilitating the transfer of ownership and reducing costs. Additionally, it outlines the functions of distribution strategies, emphasizing the need for effective logistics and market intelligence to enhance competitiveness.

Uploaded by

Ruby Ann Estrella
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Distribution Management

and the Marketing Mix


Chapter 1

Mrs. Ruby Ann Caibigan Estrella


Instructor I
Distribution Management
• Management of all activities w/c facilitates
movement and coordination of supply and
demand in the creation of time and place utility
in goods.
• The art and science of determining requirements,
acquiring them, distributing them and finally
maintaining them in an operationally ready
condition for their entire lives
Distribution Management
• Distribution management is the process of
overseeing the movement of goods from
supplier or manufacturer to point of sale.
• It refers to activities and processes such
as packaging, inventory, warehousing,
supply chain, and logistics.
Distribution
Managemen
t as a • Product
Marketing Pack
• Price
Function agin
• Promotion g
• Place/ Peop
le
Distribution Publi
c
Profi
Goal of Distribution
Management

- achieve ultimate
effi ciency in delivering raw
materials and parts, both
partially and completely
finished products to the right
place and time in the proper
condition.
Importance
moving products from point of production
to the point of destination/consumption;
gathering and sharing relevant
information that can be used to identify
key opportunities for growth and
competitiveness in the market;
obtain market intelligence which is vital in
assessing their competitive position.
Types of Distribution

Commercial Physical
Distribution or
Distribution
commonly known
as sales - also known
distribution. as logistics.
Functions involved
private
trucking-
customer warehous inventory
shipping fleet
service ing control
operation
materials s
handling integratio
store
packagin along n of
receiving location
g with plant informati
planning
warehous on.
e
Advantages of a Distribution
Management Strategy

KEEPS PROFITS UP KEEPS THINGS MAKES THINGS ALLEVIATES ANY


ORGANIZED EASIER FOR THE POTENTIAL FOR
CONSUMER ERRORS IN
DELIVERY, AS WELL
AS THE TIMES
PRODUCTS NEED TO
BE DELIVERED.
Marketing Channels
• The route between producers and consumers that
goods companies take to reach their end-users or
customers
• A set of interdependent organization that ease the
transfer of ownership as products move from
producer to business user or consumer
• Also known as trade channels or distribution
channels
Channel Member
• All parties in the marketing channel
that negotiate with one another, buy
and sell products, and facilitate the
change of ownership between buyer
and seller in the course of moving
the product from the manufacturer
to the final consumer
DirectAdvantages Disadvanta
distribution- allows products to
ges
be sold directly to customers.
-Total control
-You may
over how the
have limited
product is
market
marketed
coverage
and sold
-More time
-No fighting
consuming
for shelf
and
space with
expensive for
the
some
competition
business
Indirect distribution- means selling wholesale
to agents or retailers so that they can distribute
the product for you.

• Considerations:
-Distribution agents specialize in getting
products into as many markets as possible;
-You will share the profits with distributors;
-Retailers may sell your competitors’
products in addition to your own
Routes of Companies in
Distribution
• Company house to house campaign Consumer

• Company put up a stall Consumer

• Company C&FA Distributor Retailer


Consumer

• Company Distributor wholesaler Retailer


Distribution channel members

Company
Carrying & Consignme
owned Stockist,
Forwarding nt Selling
Distribution dealers,
Agents Agents
Centers distributors
(C&FAs) (CSAs)
(DCs)
Company’s
Wholesaler
Retailers own sales
s
force
Channel Intermediaries
Channel Intermediaries
Non-Store Retailing
Non-Store Retailing
Are intermediaries
necessary?
• Cost is a major consideration
• Technically complicated products
prefer direct distribution
• Experience shows that indirect
distribution is more effi cient and
effective than direct distribution
Functions of Intermediaries

ACCUMULATE MINIMIZE PROVIDE BUY LARGE BE AWARE


THE RIGHT
REDUCE
THE COST INFORMATI VARIETY OF OF THE
KIND OF
OF ON TO GOODS AND ENVIRONME THE
GOODS,
AGGREGATING DISTRIBUTI BOTH
MAKE NT IN W/C NUMBER
RECOMMEND THEY
AND SORTING
TO MEET
ON SELLERS ATIONS TO OPERATE OF
CONSUMER AND CUSTOMERS TOUCH
NEEDS AT THE BUYERS
POINT OF POINTS
PURCHASE
FORM A
SUPPLY
CHAIN
How does distribution add
value?
Place
utility

Time Possession
utility utility
Major Roles of Intermediary
Discrepancies and Distribution Channels
Spatial- Temporal- Break bulk-
helps reduce helps speed reduce large
the distance up in meeting quantities
between the into
producers requirementFinancialacceptable
and of the support- lot sizes for
Assortment-
consumers consumer the consumer
helps fund
provides
the activities
variety to the
of reaching
consumer to
the product
choose from
to the
Classification of Distribution Channels

• Sales Channel- motivates buyers, shares


information between the company and consumers,
negotiate fair bargains and finance transactions.
Ex. Pepsi franchisee, Nestle distributor
• Delivery Channel- meant for physical distribution.
Ex. C&FA
• Service Channel- performs after sales service.
Ex. Customer service centers/repairs
Channels of Distribution Used
Kinds of Distribution Networks
• Industrial Products
Producer Producer Producer

Industrial Distributor Agent

Consumer
Industrial Distributor Customer

Consumer
Consumer Durables
Producer

Distributor Service
back-up
Dealer or stockist

Own or Franchise
Retailer
THAN
K YOU

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