Why Is Distribution Important to Marketing?
Distibution or distribution function is determining the best methods and procedures to be used so prospective customers are able to locate, obtain, and use the products and services of an organization. Distribution is also a part of the marketing mix. Distribution is important to marketing because it is the most complex and challenging part of marketing.
Relationship Between Customer Service and Distribution
The enhanced a company is at distribution, usually the superior the client service and gratification becomes. When distribution works sound, consumers are not interested of its standing, but it is the opposite when distribution doesn't work well. A frustrated customer results from insignificant distribution. Supply and demand and economic utility are immense elements of distribution. The most essential part of economic utility to satisfy customers are time and place utility. Distribution has a good relationship with the consumer when the consumer can locate and purchase the products and services easily.
Distribution Channel
A channel of distribution is made up of the organizations and individuals who participate in the movement and exchage of products and services from the producer to the final consumer.
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Nature of Channel-member Relationships with each type of Intermediary
The connection between the manufacturer to consumer and manufacturer to industrial users is direct. Any other channel members such as wholesalers and retailers have indirect relationships and they are examples of the types of intermediary. The types are agents, wholesalers, retailer, and industrial distributors.
Role and Types of Retailers and Wholesalers
A retailer is a final business association in an indirect channel of distribution for consumer products. The role for retailers is to bid products and services to customers, support marketing activities of wholesalers and manufacturers, and finance inventory by paying the manufacturer or wholesaler.
Types of Retailers...
Wholesalers are businesses that support with distribution activities between businesses. The position for wholesalers is to provide needed marketing functions as products and services move through the channel of distribution between producers and other businesses.
Types of Wholesalers...
Types of Retailers...
- Specialty or limited line retailers- offer products form one category of merchandise or closely related items.
- Mixed merchandise retailers- offer products from serveral different categories.
- Service retailers- their primary offering is service with a limited number of products for sale that complement the services.
- Non-store retailing- involves selling directly to the consumer at home rather than requiring the consumer to travel to the store.
Other Retailer Vocabulary - Franchising- business relationship in which the developer of a business idea sells other the rights to the business idea and the use of the business name.
- Atmospherics- the elements of the shopping environment that are appealing to customers, attract them to a store, and encourage them to buy.
Wholesalers are businesses that support with distribution activities between businesses. The position for wholesalers is to provide needed marketing functions as products and services move through the channel of distribution between producers and other businesses.
Types of Wholesalers...
- Full-service wholesalers or merchant wholesalers- take title to the products they sell and provide a full range of distribution activities.
- Limited-service wholesalers or specialized wholesalers- may not provide services such as research, credit, or promotional support.
- Agents and brokers- independent businesses that provide specialized exchage functions such as locating supplies, selling, financing, or arranging shipments.
- Wholesale member clubs- businesses that offer a variety of consumer products to members through a warehouse outlet.
Physical Distribution
Physical distribution is the procedure of proficiently and efficiently transporting products and materials through the distribution channel. Main actions involved are transportation, storage, and product handling. Information handling is also important to make sure there are accurate records maintained throughout the process. The most common products are transported by railroad, trucks, ships and boats, airplanes, pipelines, and by combining methods. A warehouse is a building intended to stock large amounts of raw materials or finished product until they can be used or sold.
Transportation System
- Railroads are useful for carrying large quantities of heavy and bulky items such as raw materials, industrial equipment, and large shipments of consumer products from the factory to retailers. Problems include availability and amount of time for the process.
- Trucks- most flexible transportation method because they handle small and large shipments, goods that are durable or require speical packaging, and products that are going long distances at a rapid service.
- Ships and boats- transports large amounts of products sold internationally by water at a much lower price than airplanes. The major problem is the speed of delivery. It also takes serveral weeks after a product is loaded on a ship before it is finally delievered to the customer and damages can be an issue with bad weather.
- Airplanes- used to delievering products rapidly, but it comes with a higher price. Cargo planes are better than commercial planes because of the additional storage space. Generally, airplanes are used in special or emergency deliveries becasue of the high prices.
- Pipelines- used for transporting gas, oil, water, and small coal and wood particles mixed together into a slurry with water. It transportes large volumes over long distances. They are difficult to construct and maintain, but they can be relatively inexpensive method once they are built.
- Combining methods- popular for many businesses because several methods are utilized for each method's strengths.
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