International Distribution

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Method of exporting affects international channel. Exporting can be done in two ways namely direct exporting and indirect exporting. Important foreign intermediaries in the export business include importers, retailers, distributors, wholesalers, government departments, joint ventures and licenses.

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International Distribution

  1. 1. Chapter 11International Distribution International Marketing Chapter-11 International Decision
  2. 2. Objectives What is international distribution system What is indirect exporting What is direct export What are the types of foreign intermediaries Why the distribution system in the market is influenced by the business environment What is international logistics International Marketing Chapter-11 International Decision
  3. 3. IntroductionPlace, i.e., placing the product, is one ofthe four P’s of marketing and it refers tothe distribution of the product coveringchannels of distribution and physicaldistribution.The path traced in the direct or indirecttransfer of title to a product as it movesfrom a producer to ultimate consumers orindustrial users. International Marketing Chapter-11 International Decision
  4. 4. International Channel System The international distribution system consists of two subsystems, namely, the domestic system and the foreign system. There are broadly two ways of exporting, namely, direct exporting and indirect exporting. International Marketing Chapter-11 International Decision
  5. 5. Indirect Exporting The indirect method is more popular with firms which are just beginning their exporting activities and with those whose export business is not considerable. Two alternative channels for indirect exporting.1. International marketing middlemen2. Co-operative organisations. International Marketing Chapter-11 International Decision
  6. 6. Marketing middlemen Export merchants Export/trading houses Trading companies Export drop shipper Agents/brokers International Marketing Chapter-11 International Decision
  7. 7. Co-operative organisations The co-operative exporting organisations, which represents a cross between indirect and direct export, carries on exporting activities on behalf of several producers, and is partly under the administrative control of the manufacturers.1. Piggyback marketing2. Exporting combinations International Marketing Chapter-11 International Decision
  8. 8. Direct Export As the name indicates, direct export refers to the sale in the foreign market directly by the manufacturer. Firms with considerable export business usually resort to direct exporting. International Marketing Chapter-11 International Decision
  9. 9. Types Of ForeignIntermediaries Importers Distributors Wholesalers Retailers Multiple channels Government departments State buying organisations Joint-ventures and licensees/franchisees International Marketing Chapter-11 International Decision
  10. 10. Marketing Environment AndInternal Distribution The nature of the distribution system in a market is generally influenced by the relevant business environment. A particular distribution channel best suited for a product in one market may be inappropriate in another market. Within-country channels of distribution very considerably from country to country for consumer goods. International Marketing Chapter-11 International Decision
  11. 11. Factors Influencing ChannelSelection1. Product characteristics2. Market and customer characteristics3. Middlemen characteristic4. Company characteristic and objectives5. Competitors characteristics6. Environmental characteristics International Marketing Chapter-11 International Decision
  12. 12. International Logistics International logistics defined as ‘the designing and managing of a system that contracts the flow of materials into, through, and out of the international corporation. It encompasses the total movement concept by covering the entire range of operations concerned with product movement. International Marketing Chapter-11 International Decision
  13. 13. Components Of LogisticsManagement Fixed facilities location Transportation Inventory management Order processing Materials handling and warehousing International Marketing Chapter-11 International Decision
  14. 14. SummaryThe international channel is affected by themethod of exporting.Direct exporting and indirect exporting arethe two ways of exportingSome important foreign intermediaries are;importers, distributors, wholesalers, retailers,multiple channels, government departments,state buying organizations, joint venturesand licenses.Logistics is a factor which affects thecompetitiveness of a firm. International Marketing Chapter-11 International Decision
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