11:
Place: Chapter making goods and services available in the right quantities and locations--when customers want them. Channel of distribution: any series of firms or individuals who participate in the flow of products from producer to final user or consumer. Direct marketing: direct communication between a seller and an individual customer using a promotion method other than face-to-face personal selling. Discrepancy of quantity: the difference between the quantity of products it is economical for a producer to make and the quantity final users or consumers normally want. Discrepancy of assortment: the difference between the lines a typical producer makes and the assortment final consumers or users want. Regrouping activities: adjusting the quantities and/or assortments of products handled at each level in a channel of distribution. Accumulating: collecting products from many small producers. Bulk-breaking: dividing larger quantities into smaller quantities as products get closer to the final market. Sorting: separating products into grades and qualities desired by different target markets. Assorting: putting together a variety of products to give a target market what it wants. Traditional channel systems: a channel in which the various channel members make little or no effort to cooperate with each other. Channel captain: a manager who helps direct the activities of a whole channel and tries to avoid--or solve--channel conflicts. Vertical marketing systems: channel systems in which the whole channel focuses on the same target market at the end of the channel. Corporate channel systems: corporate ownership all along the channel. Vertical integration: acquiring firms at different levels of channel activity. Administered channel systems: various channel members informally agree to cooperate with each other. Contractual channel systems: various channel members agree by contract to cooperate with each other. Ideal market exposure: when a product is available widely enough to satisfy target customers' needs but not exceed them.
Intensive distribution: selling a product through all responsible and suitable wholesalers or retailers who will stock and/or sell the product. Selective distribution: selling through only those middlemen who will give the product special attention. Exclusive distribution: selling through only one middleman in a particular geographic area. Multichannel distribution: when a producer uses several competing channels to reach the same target market--perhaps using several middlemen in addition to selling directly (sometimes called dual distribution). Dual distribution: when a producer uses several competing channels to reach the same target market--perhaps using several middlemen in addition to selling directly (sometimes call multichannel distribution)
Reverse channels: channels used to retrieve products that customers no longer want.
Chapter 12:
Logistics: the transporting, storing, and handling of goods to match target customers' needs with a firm's marketing mix--both within individual firms and along a channel of distribution (i.e., another name for physical distribution). Physical distribution (PD): the transporting, storing, and handling of goods to match target customers' needs with a firm's marketing mix--both within individual firms and along a channel of distribution. Customer service level: how rapidly and dependably a firm can deliver what customers want. Physical distribution (PD) concept: all transporting, storing, and product-handling activities of a business and a whole channel system should be coordinated as one system which seeks to minimize the cost of distribution for a given customer service level. Total cost approach: evaluating each possible PD system and identifying all of the costs of each alternative. Supply chain: The complete set of firms and facilities and logistics activities hat are involved in procuring materials, transforming them into intermediate or finished products, and distributing them to customers. Electronic data interchange (EDI): an approach that puts information in a standardized format easily shared between different computer systems. Transporting: the marketing function of moving goods. Containerization: grouping individual items into an economical shipping quantity and sealing them in protective containers for transit to the final destination. Piggyback service: loading truck trailers or flat-bed trailers carrying containers on railcars to provide both speed and flexibility.
Freight forwarders: transportation wholesalers who combine the small shipments of many shippers into more economical shipping quantities. Storing: the marketing function of holding goods. Inventory: the amount of goods being stored. Private warehouses: storing facilities owned or leased by companies for their own use. Public warehouses: independent storing facilities. Distribution center: a special kind of warehouse designed to speed the flow of goods and avoid unnecessary storing costs.
Chapter 13:
Retailing: all of the activities involved in the sale of products to final consumers. General stores: early retailers who carried anything they could sell in reasonable volume. Single-line stores: stores that specialize in certain lines of related products rather than a wide assortment--sometimes called limited-line stores. Limited-line stores: stores that specialize in certain lines of related products rather than a wide assortment--sometimes called single-line stores. Specialty shop: a type of conventional limited-line store--usually small and with a distinct personality. Department stores: larger stores that are organized into many separate departments and offer many product lines. Mass-merchandising concept: the idea that retailers should offer low prices to get faster turnover and greater sales volume by appealing to larger numbers. Supermarkets: large stores specializing in groceries--with self-service and wide assortments. Discount houses: stores that sell hard goods (cameras, TVs, appliances) at substantial price cuts to customers who go to discounter's low-rent store, pay cash, and take care of any service or repair problems themselves. Mass-merchandisers: large, self-service stores with many departments that emphasize soft goods (housewares, clothing, and fabrics) and staples (like health and beauty aids) and selling on lower margins to get faster turnover. Supercenters (hypermarkets): very large stores that try to carry not only foods and drug items, but all goods and services that the consumer purchases routinely (also called hypermarkets). Convenience (food) stores: a convenience-oriented variation of the conventional limited-line food stores.
Automatic vending: selling and delivering products through vending machines. Door-to-door selling: going directly to the consumer's home. Telephone and direct-mail retailing: allows consumers to shop at home--usually placing orders by mail or a toll-free long distance telephone call and charging the purchase to a credit card. Wheel of retailing theory: new types of retailers enter the market as low-status, low-margin, low-price operators and then--if successful--evolve into more conventional retailers offering more services with higher operating costs and higher prices. Scrambled merchandising: retailers carrying any product lines that they think they can sell profitably. Corporate chain: a firm that owns and manages more than one store--and often it's many. Cooperative chains: retailer-sponsored groups, formed by independent retailers, to run their own buying organizations and conduct joint promotion efforts. Voluntary chains: wholesaler-sponsored groups that work with independent retailers. Franchise operation: a franchisor develops a good marketing strategy, and the retail franchise holders carry out the strategy in their own units. Wholesaling: the activities of those persons or establishments that sell to retailers and other merchants, and/or to industrial, institutional, and commercial users, but who do not sell in large amounts to final consumers. Wholesalers: firms whose main function is providing wholesaling activities. Manufacturers' sales branches: separate warehouses that producers set up away from their factories. Merchant wholesalers: wholesalers who own (take title to) the products they sell. Service wholesalers: merchant wholesalers who provide all the wholesaling functions. General merchandise wholesalers: service wholesalers who carry a wide variety of nonperishable items such as hardware, electrical supplies, furniture, drugs, cosmetics, and automobile equipment. Single-line (or general-line) wholesalers: service wholesalers who carry a narrower line of merchandise than general merchandise wholesalers. Specialty wholesalers: service wholesalers who carry a very narrow range of products and offer more information and service than other service wholesalers. Limited-function wholesalers: merchant wholesalers who provide only some wholesaling functions.
Cash-and-carry wholesalers: like service wholesalers, except that the customer must pay cash. Drop-shippers: wholesalers who own (take title to) the products they sell--but do not actually handle, stock, or deliver them. Truck wholesalers: wholesalers who specialize in delivering products that they stock in their own trucks. Rack jobbers: merchant wholesalers who specialize in hard-to-handle assortments of products that a retailer doesn't want to they manage--and often display the products on their own wire racks. Catalog wholesalers: sell out of catalogs that may be distributed widely to smaller industrial customers or retailers who might not be called on by other middlemen. Agent middlemen: wholesalers who do not own (take title to) the products they sell. Manufacturers' agents: agent middlemen who sell similar products for several noncompeting producers for a commission on what is actually sold. Export agents: manufacturers' agents who specialize in export trade. Import agents: manufacturers' agents who specialize in import trade. Brokers: agent middlemen who specialize in bringing buyers and sellers together. Export brokers: brokers who specialize in bringing together buyers and sellers from different countries. Import brokers: brokers who specialize in bringing together buyers and sellers from different countries. Selling agents: agent middlemen who take over the whole marketing job of producers--not just the selling function. Combination export manager: a blend of manufacturers' agent and selling agent--handling the entire export function for several producers of similar but noncompeting lines. Auction companies: agent middlemen who provide a place where buyers and sellers can come together and complete a transaction.
Chapter 17:
Price: the amount of money that is charged for "something" of value. Target return objective: a specific level of profit as an objective. Profit maximization objective: an objective to get as much profit as possible.
Sales-oriented objective: an objective to get some level of unit sales, dollar sales, or share of market--without referring to profit. Status quo objectives: "don't-rock-the-pricing-boat" objectives Nonprice competition: aggressive action on one or more of the Ps other than Price. Administered prices: consciously set prices aimed at reaching the firm's objectives. One-price policy: offering the same price to all customers who purchase products under essentially the same conditions and in the same quantities. Flexible-price policy: offering the same product and quantities to different customers at different prices. Skimming price policy: trying to sell the top of the market--the top of the demand curve--at a high price before aiming at more price-sensitive customers. Penetration pricing policy: trying to sell the whole market at one low price. Introductory price dealing: temporary price cuts to speed new products into a market and get customers to try them. Basic list prices: the prices that final customers or users are normally asked to pay for products. Discounts: reductions from list price given by a seller to buyers, who either give up some marketing function or provide the function themselves. Quantity discounts: discounts offered to encourage customers to buy in larger amounts. Cumulative quantity discounts: reductions in price for larger purchases over a given period, such as a year. Noncumulative quantity discounts: reductions in price when a customer purchases a larger quantity on an individual order. Seasonal discounts: discounts offered to encourage buyers to buy earlier than present demand requires. Net: an invoice term meaning that payment for the face value of the invoice is due immediately--also see cash discounts. Cash discounts: reductions in the price to encourage buyers to pay their bills quickly. 2/10, net 30: allows a 2 percent discount off the face value of the invoice if the invoice is paid within 10 days. Trade (functional) discount: a list price reduction given to channel members for the job they are going to do.
Sale price: a temporary discount from the list price. Everyday low pricing: setting a low list price rather than relying on frequent sales, discounts or allowances. Allowance: (accounting term) occurs when a customer is not satisfied with a purchase for some reason and the seller gives a price reduction on the original invoice (bill), but the customer keeps the goods or services. Advertising allowances: price reductions to firms in the channel to encourage them to advertise or otherwise promote the firm's products locally. Stocking allowances: allowances given to middlemen to get shelf space for a product--sometimes called slotting allowances. Push money (or prize money) allowances: allowances (sometimes called PMs or spiffs) given to retailers by manufacturers or wholesalers to pass on to the retailers' salesclerks for aggressively selling certain items. Trade-in allowance: a price reduction given for used products when similar new products are bought. Rebates: refunds to consumers after a purchase. F.O.B.: a transportation term meaning free on board some vehicle at some point. Zone pricing: making an average freight charge to all buyers within specific geographic areas. Uniform delivered pricing: making an average freight charge to all buyers. Freight absorption pricing: absorbing freight cost so that a firm's delivered price meets the nearest competitor's. Value pricing: setting a fair price level for a marketing mix that really gives the target market superior customer value. Unfair trade practice acts: laws that put a lower limit on prices, especially at the wholesale and retail levels. Dumping: pricing a product sold in a foreign market below the cost of producing it or at a price lower than in its domestic market. Phony list prices: misleading prices that customers are shown to suggest that the price they are to pay has been discounted from list. Wheeler Lea Amendment: law that bans unfair or deceptive acts in commerce. Price fixing: competitors illegally getting together to raise, lower, or stabilize prices. Robinson-Patman Act: a 1936 law that makes illegal any price discrimination if it injures competition.
Price discrimination: injuring competition by selling the same products to different buyers at different prices.
Chapter 18:
Markup: a dollar amount added to the cost of products to get the selling price. Markup (percent): the percentage of selling price that is added to the cost to get the selling price. Markup chain: the sequence of markups firms use at different levels in a channel--determining the price structure in the whole channel. Stockturn rate: the number of times the average inventory is sold during a year. Average-cost pricing: adding a reasonable markup to the average cost of a product. Total fixed cost: the sum of those costs that are fixed in total--no matter how much is produced. Total variable cost: the sum of those changing expenses that are closely related to output--such as expenses for parts, wages, packaging materials, outgoing freight, and sales commissions. Total cost: the sum of total fixed and total variable costs. Average cost (per unit): the total cost divided by the related quantity. Average fixed cost (per unit): the total fixed cost divided by the related quantity. Average variable cost (per unit): the total variable cost divided by the related quantity. Target return pricing: pricing to cover all costs and achieve a target return. Long-run target return pricing: pricing to cover all costs and over the long run achieve an average target return. Break-even analysis: an approach to determine whether the firm will be able to break even--that is, cover all its costs--with a particular price. Break-even point (BEP): the sales quantity where the firm's total cost will just equal its total revenue. Fixed-cost (FC) contribution per unit: the selling price per unit minus the variable cost per unit. Marginal analysis: evaluating the change in total revenue and total cost from selling one more unit to find the most profitable price and quantity.
Marginal revenue: the change in total revenue that results from the sale of one more unit of a product. Marginal cost: the change in total cost that results from producing one more unit. Rule for maximizing profit: the highest profit is earned at the price where marginal cost is just less than or equal to marginal revenue. Marginal profit: profit on the last unit sold. Price leader: a seller who sets a price that all others in the industry follow. Value in use pricing: setting prices that will capture some of what customers will save by substituting the firm's product for the one currently being used. Reference price: the price a consumer expects to pay. Leader pricing: setting some very low prices--real bargains--to get customers into retail stores. Bait pricing: setting some very low prices to attract customers but trying to sell more expensive models or brands once the customer is in the store. Psychological pricing: setting prices that have special appeal to target customers. Odd-even pricing: setting prices that end in certain numbers. Price lining: setting a few price levels for a product line and then marking all items at these prices. Demand-backward pricing: setting an acceptable final consumer price and working backward to what a producer can charge. Prestige pricing: setting a rather high price to suggest high quality or high status. Full-line pricing: setting prices for a whole line of products. Complementary product pricing: setting prices on several related products as a group. Product-bundle pricing: setting one price for a set of products. Bid pricing: offering a specific price for each possible job rather than setting a price that applies for all customers. Negotiated price: a price that is set based on bargaining between the buyer and seller.