This document discusses different models for distributing services. It identifies three main flows involved in service distribution: 1) information and promotion, 2) negotiation, and 3) product flow. For services requiring physical facilities, a network of local sites is needed, while information services can use electronic channels. The key questions for service distribution are whether customers need direct contact and if so, whether customers visit the provider's site or vice versa. The document examines strategies for customer visits, provider visits, and remote transactions via electronic channels. It emphasizes distinguishing between distributing core and supplementary services.

1. TYBBA SEM 5
PLACE: Service Distribution
Prof: Ajay Shukla
ROFEL BBA

2. • WHAT IS BEING DISTRIBUTED?
• If you mention distribution, many people will likely
think of moving boxes through physical channels to
distributors and retailers for sale to end-users.
• In services though, often there is nothing to move.
Experiences, performances, and solutions are not
physically shipped and stored.
• Meanwhile, informational transactions are
increasingly conducted via electronic channels. How
then does distribution work in a services context? In a
typical service sales cycle, distribution embraces
three interrelated flows, which partially address the
question of what is being distributed:

3. • 1. Information and promotion flow —
distribution of information and promotion
materials relating to the service offer.
The objective is to get the customer
interested in buying the service.

4. • 2. Negotiation flow — reaching an
agreement on the service features and
configuration, and the terms of the offer, so
that a purchase contract can be closed.
The objective is often to sell the right to use a
service (e.g., sell a reservation or a ticket).

5. • 3. Product flow— many services, especially
those involving people processing or
possession processing, require physical
facilities for delivery. Here, distribution
strategy requires development of a network
of local sites. For information- processing
services, such as Internet banking and
distance learning, the product flow can be via
electronic channels, employing one or more
centralized sites.

6. HOW SHOULD A SERVICE BE DISTRIBUTED?
• Be familiar with how services can be
distributed using three main options, and
understand the importance of distinguishing
between distributing core and
supplementary services.

7. • How should services be distributed? Here, a key
question is: Does the service or the firm’s
positioning strategy require customers to be in
direct physical contact with its personnel,
equipment, and facilities? (As we saw, this is
unavoidable for people-processing services, but
may not be necessary for other categories.)
• If so, do customers have to visit the facilities of
the service organization, or will the service
organization send personnel and equipment to
customers’ own sites?
• Alternatively, can transactions between provider
and customer be completed at arm’s length
through the use of either telecommunications
or physical channels of distribution?

9. • Customers Visit the Service Site
• When customers have to visit the service site,
key factors that need to be considered include
costs (e.g., rental), customer catchment areas,
and the convenience of service outlet
locations for customer.
• Elaborate statistical analysis including retail
gravity models are used to help firms make
decisions on where to locate supermarkets or
similar large stores, relative to the homes and
workplaces of future customers.

10. • Service Providers Go to Their Customers
• For some types of services, the service
provider visits the customer. Compass Group,
the largest food service organization in the
United Kingdom and Ireland, provides
catering and support services to over 8,500
locations in 50 countries with over 500,000
employees. They must visit the customer’s
site, because the need is location-specific.
When should service providers go to their
customers?

11. • Going to the customer’s site is unavoidable
whenever the object of the service is
some immovable physical item, such as
installedmachinery to be repaired, or a
house that requires pest control treatment.

12. • The Service Transaction Is Conducted Remotely
• Recognize the issues of delivering services through
electronic channels and discuss the factors that
have fueled the growth of service delivery via
cyberspace.
• Developments in telecommunications, online
technology, and sophisticated logistics solutions have
spurred (encourage) many new approaches to service
delivery.
• A customer may never see the service facilities or meet
service personnel face-to-face when dealing
with a service firm through remote transactions.
Online Subscription to Access Books, Reading Material
etc.