CHAPTER 15 terms

Understanding Business

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CHAPTER 15 - Marketing: Developing and Implementing Customer-Oriented Marketing Plans Channel of Distribution a whole set of marketing intermediaries -wholesalers and retailers- that join together to transport and store goods in their path (or channel) from producers to consumers Agents/Brokers marketing intermediaries who bring buyers and sellers together and assist in negotiating an exchange but don’t take title to (ownership of) the goods Wholesaler an intermediary that sells to other organizations, such as retailers, manufacturers and hospitals Retailer an organization that sells to ultimate consumers Marketing Intermediaries (once called middlemen) organizations that assist in moving goods and services from producers to industrial and consumer users - marketing intermediaries perform tasks like transporting, storing, selling, advertising and relationship building faster and cheaper than most manufacturers could - some people think the cost of things is increased by using a marketing intermediary and believe if we get rid of intermediaries, costs would go down Exchange efficiency - 5 retailers want to sell directly to 5 retailers. 5x5 = 25 exchange relationships. When a wholesaler enters the system, 5 manufacturers contact 1 wholesaler to contact 5 retailers to establish 5 exchange relationships. 5x1 = 5 and 1x5=5 so it creates 5+5=10 exchange relationships Points to remember - 1. Marketing intermediaries can be eliminated but their activities can’t - someone will have to perform their tasks 2. Marketing intermediaries have survived because they perform faster and cheaper - to maintain competitive advantage, they must adopt latest in technology 3. Intermediaries add cost to products but the costs are usually offset by the values they create Utility the want-satisfying ability, or value, that organizations add to goods or services when the products are made more useful or accessible to consumers than they were before Time Utility making products available when needed
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CHAPTER 15 terms - CHAPTER 15 - Marketing: Developing and...

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