07 Distribution and Retail Strategies

07 Distribution and Retail Strategies - don’t benefit...

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Distribution and Retail Strategies Vertical marketing systems Corporate—integrated Contractual o Wholesaler sponsored voluntary o Retailer sponsored cooperative o Franchising Administered Channel partnerships o No legal obligations, “formalized partnerships” i.e. Nestle and Kroger: Nestle sees Kroger as an important partner, we’ll align some of our plans with your plans Channel design market coverage o intensive (Coke), exclusive, selective (Rolex) o Hilfiger has agreed to sell his biggest clothing lines exclusively at Macy’s ability to satisfy buyer requirements o convenience, communication, variety, pre/postsale services profitability o markup by channel player % markup: retailer > wholesaler > manufacturer choose a channel with least amount of handling (thus least markup for the consumer) but it still has to have proper care (from wholesalers, retailers) Channel relationships conflict o vertical: slotting, allowances, diverting/disintermediation (consumers
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Unformatted text preview: don’t benefit because they have to pay for all the shipping costs, etc.) o supplier-retailer disagreements Haniford: one, two, three star rating for health suppliers arent’ healthy because their products with one star aren’t being bought due to rating; “arbitrary rating system” o Horizontal Territory overlaps: franchisees are guaranteed a territory, another franchisee (of the same company) opens across the street; Dual distribution: outlet malls sell at cheaper price, hurts retailers o cooperation Cooperation o Channel captain Logistics Proper care, proper refrigeration, etc. Supply chain management o For cars: Supplier network automanufacturer marketing channel consumer Balance total logistics costs and customer service factors o Total logistics costs: stockout, inventory, trannsporation, handling, order processing o Customer service: see book...
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This note was uploaded on 02/19/2008 for the course AEM 2400 taught by Professor Mclaughlin,e. during the Fall '07 term at Cornell University (Engineering School).

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07 Distribution and Retail Strategies - don’t benefit...

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