Module 1 Lecture 6 - Fall 2010 Module 1 Delighting...

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David Robinson © D. Robinson, 2010 Fall 2010 Module 1 Delighting Customers Lecture 6: Channels of Distribution
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Class 6 : “Place” Channel of Distribution The function of intermediaries Types of channels Physical distribution
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Place as one element of the Marketing Mix Marketing Mix Product Price Place Promotion Intermediaries Logistics
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Two types of Intermediaries: Wholesalers and Retailers Marketing Mix Product Price Place Promotion Intermediaries Logistics Wholesalers Retailers
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Intermediaries: Definition Intermediaries are firms that distribute products from producers (manufacturers) to consumers Wholesalers (only sell to other firms) Retailers (sell to consumers)
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Intermediaries add value “We eliminate the Middleman” … may not be such a good idea ( see Fig. 12.3 8e )
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Intermediaries Reduce the Number of Transactions in the Distribution System: Producers Consumers Without intermediaries 16 transactions
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Intermediaries Reduce the Number of Transactions in the Distribution System: Producers Consumers With intermediaries 8 transactions Intermediary Supermarket
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Functions of Intermediaries Availability The right selection of goods In the right place In the right quantity “Bulk breaking” Financing Information Storage
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Two classes of wholesalers Know the key difference between these two Wholesalers Merchant Wholesalers Agents & Brokers
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