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Amity Business School MBA Class of 2010, Semester II Distribution & Logistics Management Ms.Vandana Gupta
Designing customer-oriented  marketing channels
Distribution System for various Product categories Direct Mfg.’s  website Direct call  By Sales Force/ Phone call/ Mail Order etc Own store Indirect Dealer/ Retail Store C&F Agent Stockist Retailer Central and/or Distribution Warehouse Wholesaler/ Distributor Retailer Manufacturer/Service Provider Customers
TYPES OF DISTRIBUTION SYSTEM DIRECT DISTRIBUTION SYSTEM INDIRECT DISTRIBUTION SYSTEM MULTIPLE CHANNEL SYSTEM
[object Object],[object Object],[object Object],[object Object],[object Object]
[object Object],[object Object],[object Object],[object Object]
DESIGNING CHANNEL STRUCTURE ,[object Object],[object Object],[object Object],[object Object]
1. Determining Distribution Objective ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
2. Distribution System Alternatives ,[object Object],[object Object],[object Object],[object Object],[object Object]
3. Determining Intensity of distribution ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
4.Factors affecting Choice of Distribution Market Variables Product Variables Firm’s  Variables Marketing Intermediary Variables Nature of Market No. of Potential customers Geographic concentration of the market Order size Customer Value  models Customer Buying  Habits Unit sale value Bulk and Weight Perishable  Nature Technical  Products Product Line Nature of The product Financial Soundness Desire for Channel control Direct Distribution  Strengths Managerial Capabilities Cost of each Proposed channel Contribution of  Middleman in Value addition Availability of Desired middleman Firm marketing Intermediary Relationships dynamics
[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
What are the service outputs ,[object Object],[object Object],[object Object],[object Object]
Distribution channel design To consume  a product Service outputs  have to be delivered Channels Participates in  channel flows Activities have to be performed   Thus performs activities
Example of a service output delivered template Available Consumer financing 7. Free for first two years, but available on  payment afterwards. Also available at every  city from where the product was bought. After sales support 6. Available Installation support 5. Other consumer goods items  including that  of other competitors are  available at all the outlets where the products are otherwise Available Assortment 4. Not more than 2 days for any model Waiting time 3. There is at least one outlet for almost every  3 km radius excluding of course thinly  populated areas  Spatial  convenience 2. Units are delivered in ones  Bulk-Breaking 1. Service output delivered Service dimension Sl.No.
Channel flows and contribution to service outputs Bulk breaking, spatial  convenience, waiting time Payment Bulk breaking, spatial  convenience, waiting time Ordering Assortment Spatial convenience, waiting time, bulk breaking Financing Waiting time, bulk breaking, spatial convenience Risk taking Assortment Spatial convenience,  bulk breaking Negotiation Is a service output in itself Spatial convenience Promotion Spatial convenience  Ownership Assortment Spatial convenience,  bulk breaking, waiting time Physical Possession Other contribution Indirect contribution Direct contribution Flow
Channel design effort decisions ,[object Object],[object Object],[object Object]
Parameters for comparing channel designs ,[object Object],[object Object],[object Object],[object Object],[object Object]
The channel establishment plan  (contd .) ,[object Object],[object Object],[object Object],[object Object],[object Object]
Plan….. Contd. ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

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53601dlm Mod 2

  • 1. Amity Business School MBA Class of 2010, Semester II Distribution & Logistics Management Ms.Vandana Gupta
  • 2. Designing customer-oriented marketing channels
  • 3. Distribution System for various Product categories Direct Mfg.’s website Direct call By Sales Force/ Phone call/ Mail Order etc Own store Indirect Dealer/ Retail Store C&F Agent Stockist Retailer Central and/or Distribution Warehouse Wholesaler/ Distributor Retailer Manufacturer/Service Provider Customers
  • 4. TYPES OF DISTRIBUTION SYSTEM DIRECT DISTRIBUTION SYSTEM INDIRECT DISTRIBUTION SYSTEM MULTIPLE CHANNEL SYSTEM
  • 5.
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  • 11. 4.Factors affecting Choice of Distribution Market Variables Product Variables Firm’s Variables Marketing Intermediary Variables Nature of Market No. of Potential customers Geographic concentration of the market Order size Customer Value models Customer Buying Habits Unit sale value Bulk and Weight Perishable Nature Technical Products Product Line Nature of The product Financial Soundness Desire for Channel control Direct Distribution Strengths Managerial Capabilities Cost of each Proposed channel Contribution of Middleman in Value addition Availability of Desired middleman Firm marketing Intermediary Relationships dynamics
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  • 14. Distribution channel design To consume a product Service outputs have to be delivered Channels Participates in channel flows Activities have to be performed Thus performs activities
  • 15. Example of a service output delivered template Available Consumer financing 7. Free for first two years, but available on payment afterwards. Also available at every city from where the product was bought. After sales support 6. Available Installation support 5. Other consumer goods items including that of other competitors are available at all the outlets where the products are otherwise Available Assortment 4. Not more than 2 days for any model Waiting time 3. There is at least one outlet for almost every 3 km radius excluding of course thinly populated areas Spatial convenience 2. Units are delivered in ones Bulk-Breaking 1. Service output delivered Service dimension Sl.No.
  • 16. Channel flows and contribution to service outputs Bulk breaking, spatial convenience, waiting time Payment Bulk breaking, spatial convenience, waiting time Ordering Assortment Spatial convenience, waiting time, bulk breaking Financing Waiting time, bulk breaking, spatial convenience Risk taking Assortment Spatial convenience, bulk breaking Negotiation Is a service output in itself Spatial convenience Promotion Spatial convenience Ownership Assortment Spatial convenience, bulk breaking, waiting time Physical Possession Other contribution Indirect contribution Direct contribution Flow
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Editor's Notes

  1. Amity Business School