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Bmgt 411 chapter_14


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Bmgt 411 chapter_14

  1. 1. BMGT 411: Chapter 14 Managing Retailing, Wholesaling, and Logistics
  2. 2. Chapter Questions • What major types of marketing intermediaries occupy this sector and what marketing decisions do they face? • What are the major trends with marketing intermediaries? • What does the future hold for private label brands?
  3. 3. Table 14.1 Major Retailer Types • Specialty store • Department store • Supermarket • Convenience store • Discount store • Off-price retailer • Superstore • Catalog showroom • Club • Drug Stores
  4. 4. Speciality Store Narrow Product Lines Lower Volume, Higher Margins
  5. 5. Department Stores Several Product Lines High Volume/High Margins (Depends on Store)
  6. 6. Grocery Store High Volume/Low Margin Often Regional due to Distribution Limitations
  7. 7. Drug Stores Lower Volume/Higher Margins Convenient Locations
  8. 8. Convenience Stores High Volume/Mixed Margins Gas = low Food = High
  9. 9. Superstore Mass Retailers Very High Sales, Very Low Margin, Low Price Sells Groceries + Everything Else
  10. 10. Superstore: Built on Distribution Systems Walmart distribution system
  11. 11. Supply Chain Management • Supply chain management starts before physical distribution and means strategically procuring the right inputs (raw materials, components, and capital equipment); converting them efficiently into finished products; and dispatching them to the final destinations. • Integrated Logistics Systems: An integrated logistics system (ILS) includes materials management, material flow systems, and physical distribution, aided by information technology. •
  12. 12. Market Logistics • Sales forecasting • Distribution scheduling • Production plans • Finished-goods inventory decisions • Packaging • In-plant warehousing • Shipping-room processing • Outbound transportation • Field warehousing • Customer delivery and servicing
  13. 13. Market Logistics Decisions • How should orders be handled? • Where should stock be located? • How much stock should be held? • How should goods be shipped?
  14. 14. Figure 14.1 Determining Optimal Order Quantity
  15. 15. Levels of Retail Service • Self service: Grocery stores, etc • Self selection: Customers can find their own goods, can ask for assistance • Specialty stores • Limited service: limited service based on needs • Full service: Service every step of the way (Most expensive) • Cars, Luxury items
  16. 16. Trends in Retailing: Growth of Non-Store Selling • Direct: Avon, • Direct: 1-800 flowers • Automatic Vending
  17. 17. Table 14.2 Major Types of Corporate Retail Organizations • Corporate chain store: Chain stores and wholesalers owned by the same company • Voluntary chain: A group of retailers owned by different companies that use one wholesaler (IGA Group) • Franchise organization: Independently owned, pay a fee to be part of the franchise system. Reduction in marketing costs because of scale (McDonald’s, Jiffy Lube) • Merchandising conglomerate: Combines several retailing lines under one central ownership group
  18. 18. Top Retailing Trends • Entering Urban Areas • Getting smaller • Temporary Stores, or pop up stores • Integrating technology into the experience •
  19. 19. Urban Store Trend East Liberty Target/New York Aldi
  20. 20. Walmart - Getting Smaller? Walmart Express
  21. 21. Pop Up Stores Starbucks
  22. 22. Retailers’ Marketing Decisions • Target market • Product assortment • Procurement • Prices • Services • Store atmosphere • Store activities • Store experiences • Communications • Location
  23. 23. Store Atmosphere and Experiences Bass Pro Shops
  24. 24. Target Market Gap Inc
  25. 25. Private Label Brands • Private Label Brand: a brand that retailers or wholesalers develop • Consumer accepts private labels • Private-label buyers come from all socioeconomic strata • Private labels are not a recessionary phenomenon • Consumer loyalty shifts from manufacturers to retailers
  26. 26. Private Label Brands are Often Manufactured by the Same Company
  27. 27. Clean and Unique Style Target’s Up and Up Brand
  28. 28. Aldi - Only Sells Private Label
  29. 29. Multichannel Marketing • “Multichannel marketing” or OmniChannel puts the emphasis on providing a range of choices for customers who buy through different channels at different times or for different reasons. • concierge-about/
  30. 30. Multichannel Marketing • “Multichannel marketing” or OmniChannel puts the emphasis on providing a range of choices for customers who buy through different channels at different times or for different reasons. • N-55fqz