Distribution Management PDF

Distribution Distribution’s (main) role is to provide an effective link between production and the target customer. In todays environment, the main question is who will perform this task and how will it be executed given the new tools of technology and management.  Place of...

Distribution Distribution’s (main) role is to provide an effective link between production and the target customer. In todays environment, the main question is who will perform this task and how will it be executed given the new tools of technology and management.  Place of Distribution strategy distribution varies from market to market depending on size and local conditions More important in international Is a vital aspect of markets due to marketing distance and transportation time An integral part of sales management. Ensuring availability It is the heartbeat of of the product in the the sale right quantity, at management. Either tehe right time and Importers, sales management at the right place or distribution manufacturers and management retailers are increasingly are just cannot exist, operate or perform without in time delivery. each other.  DISTRIBUTION MANAGEMENT It is the management of all activities movement and coordination of supply and demand in the creation of time and place utility in goods. It is the art of science of determining requirements in acquiring, distributing, and finally maintaining them operationally ready condition for their entire lives. It also composed of broad range of activities concerned with the efficient movement of finished products from the end of the production line to the consumer and in some cases, it is also includes the movement of raw materials from the source of supply to the beginning of production lines. Distribution planning Is a systematic decision making regarding the physical transfer of goods and services from manufacturer to final user. Functions: Transportation It Is the way on how to transfer the finished goods from the producer/manufacturer to the ultimate buyer/consumer. Inventory Management It is the process on keeping the product safe and maintaining its stocks to avoid shortage of supply Customer Satisfaction It describes follow ups on customers including the feedback and satisfactory level after buying the products.  DISTRIBUTION CHANNEL A medium by which goods and services are made available to the customers for the use of consumption. Speed in product and services Performs the work of moving delivery and physical location products from manufacturers to significantly affects the efficiency of final consumers or business users. A a distribution channel. good distribution channel shorten (p221. Principle of marketing the time, place and possession gaps by Felina young & Cristobal Pagoso between the manufacturers and Essentially composed of marketing 2008) consumers intermediaries. These are persons (p330, Fundamentals of and firms that operate between the Marketing, 2nd edition by Josiah Go producers and the customer or & Chiqui Escareal-Go, 2010.) industrial users. Wholesaler & Retailers (p212, Principles of Marketing by Felina Young & Cristobal Pagoso 2008) DISTRIBUTION CHANNEL A set of interdependent organizations involved in the process of making a product of service available for use or consumption by the consumer or business user. (p204 Principles of Marketing by Ac-Ac, Maria Victoria 2009) Channel of Distributions is made up of people or organizations involved in the distribution process. It is any activity of firms or individuals who take part in the flow of goods CHANNEL MEMBERS MANUFACTURERS are the makers or producers of a final product SERVICE PROVIDERS are the ones who provide intangibles product to gain satisfaction from the customers Wholesalers are engaged in the activity of selling products to retailers, organizational users or other wholesalers and selling products for resale. Retailers are selling goods in small quantity directly to consumer. Marketing specialist one who is expert in the field of marketing. Consumers are the final and ultimate user of the products..  BASIC TYPES OF DISTRIBUTION CHANNEL DIRECT INDIRECT CHANNEL CHANNEL OF DISTRIBUTION DISTRIBUTION Transfer or movement of Transfer or movement of goods and services from goods or tangible products manufacturer to final user and services or intangible without intervention of goods from manufacturer independent middleman. or producers to independent Firm wanted to control the intermediaries or marketing program and customers. wanted to have close contact with consumers. Result in sales volume. Physical distribution A broad range of activities primarily concerned with the efficient movement of finished goods from the end of the production line to the consumers. It includes the movement of raw materials from the source of supply to the beginning of the production line. It covers the broad range of activities about the efficient delivery of raw materials, parts, semi-finished items, and finished products to designated places and designated times and in proper conditions, Physical distribution may involved Customer service. – the ability of the organization to satisfy the customer to its maximum level. Shipping - the ability to transfer a durable product from one location to the other normally a far place. Warehousing – the ability to properly store the raw materials, semi- processed goods used to produce a final product. Inventory Control – the ability to provide sufficient supply of raw materials at the right quantity, time and quality. Packaging- the ability to make the product presentable before the physical appearance including its taste, color, size ,weight and shape. Receiving materials handling – the ability to properly manage the materials for the final production. TRANSPORTATION The ability of the organization to transport the available goods into the customer custody. It helps in the proper distribution of products for customer satisfaction and continuous patronage. FIVE BASIC TRANSPORATI ONS FORMS: RAILROADS – carry heavy, bulky items that are low in value over long, distances. Some of the products are inexpensive and low selling price. Motor carries- transport small shipments over short distances or in a nearby town. Some of the product need immediate delivery normally it is low cost of production. Waterways – move goods which are low but high bulk freight on barges via inland rivers and on tankers, and inter-coastal shipping. *Transported from one region to another. Pipelines –reliable, continuous movements of liquids, gases and semi-liquid. Airways – fastest, most expensive form for perishable and emergency good that needed to be transported separately from others to avoid delay. * Upper class customer. CATEGORIES OF TRANSPORTATION FIRMS Common carriers – transport goods of any firms(normally the private individual) or individual interested in the services to properly transfer the goods. Contract carriers - provide one or few shippers and specific goods with transportation services based on individual even in a group agreement. Exempt Carriers - excused from legality and must only comply with with safety requirements. Private Carriers - Shippers used their own facilities, subject to safety rules and regulations from local or national regulations. Inventory Management Its main objective is to provide a continoues flow of goods And to match the quantity of goods kept in proper inventory as closely as possible with sales demand to meet the required profit in the production and delivery of products both to the organization and individual clients. Two Concept if Inventory Management 1. Just in Time (JIT) Two Concept if Inventory Management It reduce the amount of inventory it keeps on 2. Electronic Data Interchange (EDI) hand by ordering the more frequently and in -computer link ups between suppliers ad their lower quantity of raw materials even the semi manufacturers and wholesalers to increase processed goods. through its timely monitoring of available stocks needed in the production both raw materials -Quick Response (QR) Inventory System. and the semi processed goods.  WAREHOUSING It involves the physical facilities used primarily for the shortage of goods and maintenance of supply for efficient delivery held in anticipation pf sales and transfer within a distribution channel on the organization. Private Warehouse Public Warehouse Bonded Warehousing Field Warehousing t WHOLESALING Types of Wholesaling. The process of buying, carrying and A. Manufacturer Wholesaling merchandising its subsequent -the manufacturer or resale to organizational customers, producers control wholesaling retailer and/or other wholesaler but which performs all functions such not the sale of significant quantity as owning the products who does to final customer. not received payment until a retail functions buys and deals with a smaller group of customers to B. Merchant Wholesaling maintain customer patronage. -Wholesaler controls wholesaling such as buying in a bulk of units and performs many C. Agent and Brokers functions such as warehousing and -manufacturers owns the inventory control. products and lets the broker sell the property and pay the agent a commissions.  Business activity involved on the sales of goods and Retailing services to the final and ultimate user of the product for personal, family or household use. Types of retailing Independent retailer operates only one outlet because of limited resources such as manpower, machine, materials, method, money and the market. Offers personal service, a convenient location and close customer contact through its personalized or customized service. Retail Chain involves common ownership of multiple outlets through its dealership, with centralized systematic purchasing process and efficient decision making, dispersed target or specific markets and well known company name as well as the organization. Retail Franchising contractual arrangement between a franchisor and a retailed franchise this allow the franchisee to conduct business under an established name according to the rules and regulations Leased Department department in a retail store that is rented to an outside party. Consumer Cooperative a retail firm owned and managed by consumer member who invets and shares profits. STORE STRAGY MIX Convenience Store Conventional Supermarket Superstore Combination Store Specialty Store Variety Store Department Store Retail Catalogue showroom, Non store operations Vending Machine Direct Selling Direct Marketing Store location It is a looking for better place selling a certain product. ✓ Accessibility to the market ✓ Free from danger ✓ Convenience to the suppliers. Forms of store locations Isolated Store – a retail outlet which is located on a street where there is no adjacent store that draws customers traffic and captures the interest as well as impact to the passerby Unplanned Business District – refers to two or more stores which are located and close to one another that produce healthy competition by attracting more customers Distribution strategy It refers to the process of moving goods and services from the company to the customer. Common distribution channel ✓ Direct sale is when the company/firms plan is to move goods directly to the ultimate users. ✓ Original equipment manufacturer sales involve selling a manufactured product and which later sold as a finished product to the end users. ✓ Manufacturers representative is wholesalers employed by one or several producers and paid on commission according to quantity sold ✓ Wholesalers are channel members that sells to retailers or other agents for further distribution through the channel until they reach the final users. ✓ Brokers are distributors who buy directly from distributor or wholesalers and sells to retailers or end users. ✓ Retailers are the ones who directly sell to the customer in the store. They buy products without intermediaries or middlemen. ✓ Direct mail includes printed materials used in a targeted campaign to consumers these are directly sent to consumers. There includes catalogs, letters, email and other direct appeals. THANK YOU!