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12 Cards in this Set
- Front
- Back
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Channels of Distribution
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Channel Strategy
Channel Decisions Legal Issues in Channel Relationships |
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Channel Intermediaries
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Manufacturer-Wholesaler-Retailer-Consumer
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Channel Example
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Starbucks:--- Channel Evolution:
Company-owned, stand-alone stores Licensed Vendors, e.g., Barnes&Noble Airline partnerships Hospital kiosks Supermarket Chains Separate development of Seattle's Best brand |
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Vital Channel Functions
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Communicating (Promotion)
Negotiating Ordering, Reordering Financing Carrying Inventory Collecting Payments Transferring Ownership Transporting |
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Channel Management Decisions
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Select Target Markets
Determine Degree of Control Desired Choose Degree of Market Coverage Choose Types of Outlets Determine Investment Required Estimate Costs and Revenues |
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Considerations in Developing Channel Strategy
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Channel Configuration
Levels Players Factors that Influence Selection of a channel Level of Coverage Intensity Intensive Selective Exclusive How Vertically-integrated do you want to be? The "network" view of Competition. |
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Factors affecting Channel choice and management
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Environmental
Fuller Brush: " No one at Home"....and Who Cleans the House anyway? Kroger: Buys Flowers Direct from Growers (Technological Advances in Growing, Transporting, Storage)...Translates to a very profitable business |
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Factors affecting Channel Choice and Management
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Consumer Factors
Richoh; Targeted the "serious" camera user Sales tripled in 18 months after switch from a wholesaler-mass merchandiser channel to one featuring agents-speciality retailers Product Factors Unit value, standardization |
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Factors Affecting Channel Choice and Management
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Company Factors
Financial, Human, Technological Resources Desired Market Coverage and Control Intensive, selective, exclusive Buyer Requirements Information, convenience, variety services Profit. |
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Clayton Act
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Legal issues in channel Relationships
Agreement prohibiting a channel member from handling competing products Are considered violations of the Clayton Act if a dealer's sales volume represents a substantial percentage of total sales in the market area Sellers initially entering a market can use these agreements to strengthen competitive position. |
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Closed Sales Territories
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Restricts the geographic resale territories for each distributor
Legality depends on whether restrictions lessen competition; if so they likely are in violation of the FTC Act and of certain provisions of the Sherman and Clayton Acts. |
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Tying Agreements
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Agreements requires a dealer that wishes to purchase a product/service from a manufacturer to also carry/purchase other products/services made by the producer
Violate the Clayton and Sherman Acts When the agreements lessen competition or create monopoly |
