marketing channels & scm ppt @ bec doms bagalkot mba
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Marketing channels & scm ppt @ bec doms bagalkot mbaTRANSCRIPT
1
Marketing Channels & SCM
2
Learning Objectives
1212
1. Explain what a marketing channel is and why intermediaries are needed.
2. Define the types of channel intermediaries and describe their functions and activities.
3
chapter
Learning Objectives (continued)
1212
3. Describe the channel structures for consumer and business-to-business products and discuss alternative channel arrangements.
4. Define supply chain management and discuss its benefits.
5. Discuss the issues that influence channel strategy.
4
chapter
Learning Objectives (continued)
1212
6. Explain channel leadership, conflict, and partnering.
7. Describe the logistical components of the supply chain.
8. Discuss the concept of balancing logistics service and cost.
5
chapter
Learning Objectives (continued)
1212
9. Discuss new technology and emerging trends in supply chain management.
10. Discuss channels and distribution decisions in global markets.
11. Identify the special problems and opportunities associated with distribution in service organizations.
6
Learning Objective 11
Explain what a marketing channel is and why intermediaries are needed.
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Marketing Channels 11
MarketingChannel
MarketingChannel
SupplyChain
SupplyChain
A set of interdependent organizations that ease the transfer of ownership as
products move from producer to business user or consumer.
A set of interdependent organizations that ease the transfer of ownership as
products move from producer to business user or consumer.
The connected chain of all the business entities, both internal and external to the
company, that perform or support the logistics function.
The connected chain of all the business entities, both internal and external to the
company, that perform or support the logistics function.
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Marketing Channel Functions
Specialization andDivision of Labor
Specialization andDivision of Labor
ChannelsFulfillThree
ImportantFunctions
ChannelsFulfillThree
ImportantFunctions
OvercomingDiscrepanciesOvercoming
Discrepancies
Providing ContactEfficiency
Providing ContactEfficiency
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9
Specialization and Division of Labor
11
Provides economies of scale
Aids producers who lack resources to market directly
Builds good relationships with customers
10
Overcoming Discrepancies
Discrepancyof
Quantity
Discrepancyof
Quantity
Discrepancyof
Assortment
Discrepancyof
Assortment
The difference between the amount of product produced and the
amount an end user wants to buy.
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.
The lack of all the items a customer needs to receive full satisfaction from a product or
products.
11
11
Overcoming Discrepancies
TemporalDiscrepancy
TemporalDiscrepancy
SpatialDiscrepancy
SpatialDiscrepancy
A situation that occurs when a product is produced but a
customer is not ready to buy it.
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.
The difference between the location of a producer and the
location of widely scattered markets.
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12
Contact Efficiency
ZenithZenith SonySony RCARCA ToshibaToshiba
ZenithZenith SonySony RCARCA ToshibaToshiba
Circuit CityCircuit City
11
13
Learning Objective 22
Define the types of channel intermediaries and describe their
functions and activities.
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Channel Intermediaries
RetailerRetailer
MerchantWholesalerMerchant
Wholesaler
Agents andBrokers
Agents andBrokers
A channel intermediary that sells mainly to customers.
A channel intermediary that sells mainly to customers.
An institution that buys goods from manufacturers, takes title
to goods, stores them, and resells and ships them.
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 member.
Wholesaling intermediaries who facilitate the sale of a product by representing channel member.
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15
Channel Intermediaries
RetailersRetailers
Merchant WholesalersMerchant
Wholesalers
Agents and
Brokers
Agents and
Brokers
Take Title to GoodsTake Title to Goods
Take Title to GoodsTake Title to Goods
Do NOT Take Title to GoodsDo NOT Take Title to Goods
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Channel Functions Performed by Intermediaries
Contacting/Promotion
Negotiating
Risk Taking
FacilitatingFunction
FacilitatingFunction
TransactionalFunctions
TransactionalFunctions
Logistical Functions
Logistical Functions
Researching
Financing
Physically distributing
Storing
Sorting
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17
Logistics
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.
22
18
Learning Objective
Describe the channel structures for consumer and
business-to-business products and discuss alternative channel arrangements.
33
19
Direct Channel
A distribution channel in which
producers sell directly to
consumers.
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20
Channels for Consumer Products
Producer Producer Producer Producer
Consumers Consumers Consumers Consumers
Retailers Retailers Retailers
Wholesalers Wholesalers
Agents orBrokers
WholesalerChannel
RetailerChannel
DirectChannel
Agent/BrokerChannel
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21
Channels for Business-to-Business Products
Producer Producer Producer Producer
IndustrialUser
IndustrialUser
IndustrialUser
IndustrialUser
IndustrialDistributor
IndustrialDistributor
Agents orBrokers
Agents orBrokers
Agent/BrokerChannel
IndustrialDistributor
DirectChannel
Producer
GovernmentBuyer
DirectChannel
Agent/BrokerIndustrialChannel
33
22
Alternative Channel Arrangements
DifferentChannels
May be Used
Multiple Channels
Adaptive Channels
Strategic ChannelAlliances
NontraditionalChannels
33
23
Learning Objective
Define supply chain management and discuss its benefits.
44
24
Supply Chain Management
A management system that
coordinates and integrates all of
the activities performed by
supply chain members into a
seamless process, from the
source to the point of
consumption.
44
25
Supply Chain Management
Resultsof
Supply ChainManagement
Resultsof
Supply ChainManagement
Focus on Innovative SolutionsFocus on Innovative Solutions
Competitive with focus onCustomer Satisfaction
Competitive with focus onCustomer Satisfaction
Synchronized FlowSynchronized Flow
Customer ValueCustomer Value
44
26
Physical flow process that engineers the
movement of goods
Physical flow process that engineers the
movement of goods
Communicator of customer demand frompoint of sale to supplier
Communicator of customer demand frompoint of sale to supplier
Role of Supply ChainManagement
Role of Supply ChainManagement
Role of Supply Chain Management44
27
Supply Chain Management Activities
44
Manage relationships in the supply chain
Manage relationships in the supply chain
Manage the logistical components of the supply chain
Manage the logistical components of the supply chain
Determine channel strategy and level of distribution intensity
Determine channel strategy and level of distribution intensity
Balance the costs of the supply chainwith the service level demanded by customer
Balance the costs of the supply chainwith the service level demanded by customer
28
Benefits of Supply Chain Management
Common Benefitsof Supply Chain
Management
Common Benefitsof Supply Chain
Management
Reduced Costs Reduced Costs
Improved ServiceImproved Service
Enhanced RevenuesEnhanced Revenues
44
29
Learning Objective
Discuss the issues that influence channel strategy.
55
30
Channel Strategy Decisions
Issues that InfluenceChannel Strategy
Issues that InfluenceChannel Strategy
Producer FactorsProducer Factors
Product FactorsProduct Factors
Market FactorsMarket Factors
Factors Affecting Channel Choice
Factors Affecting Channel Choice
Exclusive DistributionExclusive Distribution
Selective DistributionSelective Distribution
Intensive DistributionIntensive Distribution
Levels ofDistribution
Intensity
Levels ofDistribution
Intensity
55
31
Market Factors
Market FactorsThat Affect
ChannelChoices
Market FactorsThat Affect
ChannelChoices
Customer ProfilesCustomer Profiles
Consumer or IndustrialCustomer
Consumer or IndustrialCustomer
Size of MarketSize of Market
Geographic Location
55
32
Product Factors
Product FactorsThat Affect
ChannelChoices
Product FactorsThat Affect
ChannelChoices
Product Complexity Product Complexity
Product PriceProduct Price
Product Life CycleProduct Life Cycle
Product DelicacyProduct Delicacy
55
33
Producer Factors
Producer FactorsThat Affect
ChannelChoices
Producer FactorsThat Affect
ChannelChoices
Producer Resources Producer Resources
Number of Product LinesNumber of Product Lines
Desire for Channel ControlDesire for Channel Control
55
34
Levels of Distribution Intensity 55
Intensity LevelIntensity Level ObjectiveObjective Number of Intermediaries
Number of Intermediaries
IntensiveIntensive
SelectiveSelective
ExclusiveExclusive
Achieve mass marketselling.
Convenience goods.
Achieve mass marketselling.
Convenience goods.
Work with selected intermediaries.
Shopping and some specialty goods.
Work with selected intermediaries.
Shopping and some specialty goods.
Work with singleintermediary. Specialty
goods and industrial equipment.
Work with singleintermediary. Specialty
goods and industrial equipment.
ManyMany
SeveralSeveral
OneOne
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Learning Objective 66
Explain channel leadership, conflict, and partnering.
36
Managing Channel Relationships
Channel PartneringChannel Partnering
Channel ConflictChannel Conflict
Channel LeadershipChannel Leadership
Channel ControlChannel Control
Channel PowerChannel Power
Social Dimensions of Channels
Social Dimensions of Channels
66
37
Channel Power, Control, and Leadership
ChannelPower
ChannelPower
ChannelControl
ChannelControl
Channel Leader
Channel Leader
A channel member’s capacity to control or influence the behavior
of other channel members
A channel member’s capacity to control or influence the behavior
of other channel members
A situation that occurs when one marketing channel member intentionally affects another
member’s behavior.
A situation that occurs when one marketing channel member intentionally affects another
member’s behavior.
A member of a marketing channelthat exercises authority/power over
the activities of other members.
A member of a marketing channelthat exercises authority/power over
the activities of other members.
66
38
Channel Conflict
A clash of goals and methods between
distribution channel members.
HorizontalConflict
HorizontalConflict
Occurs among channel members on the same level
Occurs among channel members on the same level
VerticalConflictVerticalConflict
Occurs among channel members at different levels
Occurs among channel members at different levels
66
39
Channel Partnering
The joint effort of all channel
members to create a supply chain
that serves customers and creates
a competitive advantage.
66
40
Transaction- vs. Partnership-Based Firms
Transaction-Based Transaction-Based
Short-term relationshipsShort-term relationships
Multiple suppliersMultiple suppliers
Adversarial relationshipsAdversarial relationships
Price dominatesPrice dominates
Minimal supplier investmentMinimal supplier investment
Minimal information sharingMinimal information sharing
Firms are independent Firms are independent
Minimal functional area interaction Minimal functional area interaction
Partnership-Based Partnership-Based
Long-term relationshipsLong-term relationships
Few suppliersFew suppliers
Cooperative partnerships Cooperative partnerships
Value-added services dominateValue-added services dominate
High supplier/buyer investmentHigh supplier/buyer investment
Extensive information sharingExtensive information sharing
Firms are interdependent Firms are interdependent
Extensive functionalarea interactionExtensive functionalarea interaction
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41
Learning Objective
Describe the logistical components of the supply chain.
77
42
Integrated Logistical Components of the Supply Chain
Sourcing & ProcurementSourcing & Procurement
Production SchedulingProduction Scheduling
Order Processing & Customer ServiceOrder Processing & Customer Service
Inventory ControlInventory Control
SupplyChainTeam
SupplyChainTeam
Warehouse & Materials HandlingWarehouse & Materials Handling
TransportationTransportation
Lo
gis
tics
Info
rma
tio
n S
yste
mL
og
isti
cs In
form
ati
on
Sys
tem
77
43
Sourcing and Procurement
NegotiateService Levels
NegotiateService Levels
NegotiatePrice
NegotiatePrice
SelectSuppliers
SelectSuppliers
DevelopSpecifications
DevelopSpecifications
Plan Purchasing Strategies
Plan Purchasing Strategies
Role ofPurchasing
Departments
Role ofPurchasing
Departments
77
44
Production Scheduling
Push/Pull Strategy Push/Pull Strategy
Traditional Focus Traditional Focus
PushPush
Start of ProductionStart of Production
ManufacturingManufacturing
Inventory-BasedInventory-Based
Mass ProductionMass Production
Customer Focus Customer Focus
PullPull
Customer-Order Based
Customer-Order Based
Mass CustomizationMass Customization
77
45
Just-in-Time Manufacturing 77
A process that redefines and
simplifies manufacturing by
reducing inventory levels and
delivering raw materials just
when they are needed on the
production line.
46
Benefits of JIT
Reduces raw material inventories
Shortens lead times
Creates better supplier relationships
Reduces production and storeroom costs
Reduces paperwork
77
47
Electronic Data Interchange 77
Information technology that
replaces paper documents that
accompany business
transactions.
48
Inventory Control System 77
A method of developing and
maintaining an adequate
assortment of materials or
products to meet a
manufacturer’s or a customer’s
demand.
49
Warehouse and Materials-Handling
77
Functionsof
Materials Handling
Receive goods into warehouse
Dispatch the goods totemporary storage
Recall, select, or pick the goods for shipment
Identify, sort and label goods
50
Transportation
CostCost
Transit TimeTransit Time
ReliabilityReliability
CapabilityCapability
AccessibilityAccessibility
TraceabilityTraceability
Criteria for
Transportation Mode
Choice
Criteria for
Transportation Mode
Choice
77
51
Criteria for RankingModes of Transportation
77
Relative Cost
TransitTime
Reliability
Capability
Accessibility
Traceability
Highest Lowest
Air WaterPipeRailTruck
Water Rail Pipe Truck Air
Pipe Truck Rail Air Water
Water
Truck
Rail Truck Air Pipe
Rail Air Water Pipe
Air Truck Rail Water Pipe
52
Learning Objective
Discuss the concept of balancing logistics service and cost.
88
53
Logistics Service
Interrelated activities performed
by a member
of the supply chain to ensure that
the right product is in the right
place at the right time.
88
54
Logistical Competencies 88
Devise logistics service strategies as a means of competitive differentiation
Integrate members of supply chain to achieve operating excellence
Respond quickly to changing logistical requirements
Constantly monitor all aspects of the supply chain
55
Learning Objective
Discuss new technology and emerging trends in
supply chain management.
99
56
Trends in Supply Chain Management
99
Electronic DistributionElectronic Distribution
Outsourcing ofLogistics Functions
Outsourcing ofLogistics Functions
AdvancedComputer Technology
AdvancedComputer Technology
Trends Affecting the
Logistics Industry
Trends Affecting the
Logistics Industry
57
Learning Objective
Discuss channels and distribution decisions in global markets.
1010
58
Channels and Distribution Decisions for Global Markets
Channel structure differs
Channel types differ
“Gray” marketing channels
Global Channel Development
Global Channel Development
Global SupplyChain Management
Global SupplyChain Management
Awareness of trade legalities
Transportation Infrastructure
1010
59
Learning Objective 1111
Identify the special problems and opportunities associated with
distribution in service organizations.
60
Channels and DistributionDecisions for Services
1111
Areas of Focus for
Service Distribution
Areas of Focus for
Service Distribution
Minimizing wait times Minimizing wait times
Managing service capacityManaging service capacity
Improving delivery through new channels
Improving delivery through new channels