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Ch10
 

Ch10

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    Ch10 Ch10 Presentation Transcript

    • MANAGEMENT OF INTERNATIONAL DISTRIBUTION AND LOGISTICS Session 10
    • CONSIDERATIONS
      • Selection of foreign country intermediaries
      • How to build a relationship with them
      • How to deal with variety of retailing structures
      • How to maximise new and innovative forms of distribution
      • How to manage logistics of physical distribution
    • DISTRIBUTION CHANNELS FOR BUSINESS GOODS
    • DISTRIBUTION CHANNELS FOR CONSUMER GOODS
    • 11 C MODEL: Selecting Appropriate Channel Intermediaries C ustomer characteristics C ulture C ompetition C ompany objectives C haracter of the market C ost Source: Czinkota & Ronkainen (2006) C apital required C overage needed C ontrol issues C ontinuity provided C ommunication effectiveness
    • USING A COMPANY OWNED SALES FORCE
      • Advantages
        • far greater control over sales and marketing effort
        • facilitates formation of closer manufacturer-customer relationships
        • can be used to identify and exploit new international marketing opportunities
      • Disadvantages
        • relatively larger resource commitment
        • higher exit costs
        • increased exposure to unexpected changes in political/social environment of host country
      • Traditional retailing
      • Intermediary retailing
      • Structured retailing
      • Advanced retailing
        • Interactive customer marketing
        • Mass customisation
        • Data mining
        • Category management
        • Effective consumer response
      DIFFERING PATTERNS OF RETAILING
    • RETAILERS - TYPICAL DIFFERENCES BETWEEN DEVELOPING & DEVELOPED COUNTRIES
    • PUSH FACTORS OF THE INTERNATIONALISATION OF RETAILING
      • Saturation of the home market or over-competition
      • Economic recession or limited growth in spending
      • A declining or ageing population
      • Strict planning policies on store development
      • High operating costs - labour, rents, taxation
      • Shareholder pressure to maintain profit growth
      • The ‘me too’ syndrome in retailing
    • PULL FACTORS OF THE INTERNATINALISATION OF RETAILING
      • Underdevelopment of some markets or weak competition
      • Strong economic growth or rising standards of living
      • High population growth or high concentration of young adults
      • A relaxed regulatory framework
      • Favourable operating costs - labour, rents, taxation
      • The geographical spread of trading risks
      • Opportunity to innovate under new marketing conditions
    • Top 10 Global Food Retailers www.supermarketnews.com (2006)
    • GLOBAL RETAILER CATEGORIES
    • IMPLICATIONS FOR DISTRIBUTION STRATEGY DEVELOPMENT
      • Power shifts in supply chains towards retailers
      • Intense concentrated competition with significant buyer power across country markets
      • Rapidly advancing technology facilitating global sourcing and global electronic transactions
      • Unrelenting performance measures being demanded of suppliers by international retailers
      • Smart, demanding consumers expecting high levels of customer service
    • RETAILERS DEMAND
      • Streamlined and flexible supply chains
      • Suppliers who can guarantee quality and reliability across global markets
      • The ability to supply high volumes and conduct intense relationships with intermediaries in the supply chain
      • Suppliers who can meet the global sourcing requirements of large-scale retailers seeking to buy centrally across the globe
    • International Market Characteristics Favouring internet based distribution
      • Inefficiencies in traditional distribution channels
      • Market fragmentation
      • Minimum scale barriers
      • Commodity-type products
      • Short life-cycle products
    • LOGISTICS APPROACH TO PHYSICAL DISTRIBUTION Customer Service
      • Order to delivery time
      • Consistency and reliability of delivery
      • Inventory availability
      • Order, size constraints
      • Ordering convenience
      • Delivery time and flexibility
      • Invoicing procedures, documentation and accuracy
      • Claims procedure
      • Condition of goods
      • Salesperson’s visits
      • Order status information
      • After-sales support
    • LOGISTICS APPROACH TO PHYSICAL DISTRIBUTION IT and Physical Distribution
      • Information Technology
        • Electronic data interchange (EDI)
        • ‘ New silc road’
        • Tracking progress of products
      • Restructuring Physical Distribution Operations
        • Changes in trading structures
        • Physical movement is high-cost activity
    • EFFECTIVE SYSTEM OF PHYSICAL DISTRIBUTION
      • Requirements
        • clearly define areas of responsibility
        • highly developed planning system
        • comprehensive information support system
        • expertise in distribution management
        • centralising planning body
      • Considerations
        • How intermediaries can enhance service
        • modes of transportation to be used
        • how to make use of export processing zones
        • documentation required
        • packaging requirements for transit & the market
        • how should the export sales contract be organised
    • EXPORT PROCESSING ZONES
      • The concept of EPZ
        • duty-free manufacture or processing of products for export purposes within a customs-controlled environment
      • Advantages
        • All goods entering the EPZ are exempted from customs duties and import permits
        • Firms can use foreign currency to settle transactions
        • EPZs can be used for assembly of products and so help reduce transportation costs
        • EPZs give greater flexibility, and help avoid unwanted bureaucracy of customs and excise
    • THE EXPORT ORDER & PHYSICAL DISTRIBUTION