Create efficiencies because they reduce the number of

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- Create efficiencies because they reduce the number of transactions necessary for goods to flow form many different manufacturers to large numbers of customers. Two ways: o Breaking bulk dividing larger quantities of goods into smaller lots in order to meet the needs of buyers Buy goods in large numbers only sell one or few at a time to many different customers o Creating assortments providing a variety of products in one location to meet the needs of buyers in one set time Facilitating functions functions of channel intermediaries that make the purchase process easier for customers and manufacturers Disintermediation (of the channel of distribution) the elimination of some layers of the channel of distribution in order to cut costs and improve the efficiency of the channel Knowledge management a comprehensive approach to collecting, organizing, storing, and retrieving a firm’s information assets Online distribution piracy the theft and unauthorized repurposing of intellectual property via the Internet Ch 15: Objective 3: Wholesaling Intermediaries Each distribution alternative traces a different path from producer to consumer. Wholesaling intermediaries firms that handles the flow of products form the manufacturer to the retailer or business user Independent intermediaries channel intermediaries that are not controlled by any manufacturer but instead to business with many different manufacturers and many different customers - Merchant wholesalers intermediaries that buy goods from manufacturers (take title to them) and sell to retailers and other business-to-business customers o Take title to accept legal ownership of a product and assume the accompanying rights and responsibilities of ownership - Merchandise agents or brokers channel intermediaries that provide services in exchange for commissions but never take title to the product o Agents normally represent buyers or sellers on an ongoing basis, whereas clients employ brokers for a short period of time Ch 15: Objective 4: Types of Distribution Channels - Describe types and how place fits in with the other 3 P’s in the marketing mix
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Channel levels the number of distinct categories of intermediaries that populate a channel of distribution Pg. 458 of Different types of channels of distributions Hybrid marketing system a marketing system that sues a number of different channels and communication methods to serve a target market Slotting Allowance a fee paid in exchange for agreeing to place a manufacturer’s products on a retailer’s valuable shelf space Chapter 15: Objective 5: Plan a Distribution Channel Strategy 1. Develop distribution objectives 2. Evaluate internal and external environment influences 3. Choose a distribution strategy Participants in any distribution channel form an interrelated system. IN general, these marketing systems take one of three forms: - Conventional marketing system a multiple-level distribution channel in which channel members work independently of one another - Vertical marketing system (VMS) a channel of distribution in which there is
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  • Spring '08
  • billthompson
  • Marketing, producer, final product

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