•
FACTORS GOVERNING THE CHOICE OF CHANNEL OF
DISTRIBUTION AND INTERMEDIARY
CHANNELS OF DISTRIBUTION
MARKETING
MEANING OF DISTRIBUTION
CHANNELS OF DISTRIBUTION
MARKETING
MEANING OF DISTRIBUTION
•
DISTRIBUTION IS THE PROCESS OF MAKING A PRODUCT
OR SERVICES AVAILABLE FOR USE OR CONSUMPTION BY A CONSUMER OR BUSINESS USERS
USING DIRECT MEANS OR USING INDIRECT MEANS WITH
•
DISTRIBUTION CHANNEL IN MARKETING REFERS TO
PATH THROUGH WHICH GOODS AND SERVICES TRAVEL TO GET FROM THE PLACE OF
PRODUCTION OR MANUFACTURER TO THE FINAL USERS
§ TWO TYPES OF CHANNEL
1. DIRECT
2. INDIRECT
•
FACTORS
GOVERNING THE CHOICE OF CHANNEL OF DISTRIBUTION
1. PRODUCT
FACTORS
2. MARKET
FACTORS
3. INSTITUTIONAL
FACTORS
4. UNIT FACTORS
5. ENVIRONMENTAL
FACTORS
•
PRODUCT FACTORS
•
PHYSICAL NATURE:
1. MUST COPE THE PERISH ABILITY/PHYSICAL
2. SEASONALITY
3. UNIT VALUE
ALSO INFLUENCE THE CHANNEL CHOICE/ IF THE UNIT VALUE IS HIGH INTENSIVE DISTRIBUTION
AND IF THE UNIT VALUE IS HIGH THEN MORE SELECTIVE DISTRIBUTION
•
TECHNICAL NATURE:-SIMPLE OR COMPLEX
1. TECHNICAL
PRODUCT EXCLUSIVE DEALERSHIP
2. IF THE
PRODUCT IS NOT TECHNICAL THEN INTENSIVE DISTRIBUTION
•
THE LENGTH OF PRODUCT LINE:- DECISION OF USING A
SINGLE CHANNEL OR USING MULTIPLE PRODUCT LINES
•
THE MARKET POSITION:- ESTABLISHED
PRODUCT MADE AND PROMOTED BY A REPUTED MANUFACURER MAY HAVE A HIGH DEGREE OF
MARKETING ACCEPTANCE AND CAN BE SOLD THROUGH VARIOUS CHANNELS
•
MARKET FACTORS
•
THE NUMBER OF BUYERS:-
1. IN CASE OF
LARGE NUMBER OF BUYERS THEN IT IS BETTER TO TAKE THE SERVICES OF THE MIDDLEMEN
2. OR THE
DISTRIBUTION SHOULD BE DONE BY MANUFACTURE IF THE NUMBER OF THE BUYER IS LESS
§ TYPE OF BUYERS:-
1. GENERAL
BUYERS:-MORE MIDDLEMEN
2. INDUSTRIAL
BUYERS:-LESS MIDDLEMEN
•
BUYING HABITS:-A
MANUFACTURER SHOULD TAKE THE SERVICES OF THE MIDDLEMEN IF HIS FINANCIAL POSITION DOES NOT PERMIT HIM TO
SELL GOODS ON CREDITS THEN HE SHOULD TAKE THE SERVICES OF THE MIDDLEMEN
•
BUYING QUANTITY:-USE MIDDLEMEN IF THE QUANTITY BOUGHT IS SMALL
•
SIZE OF THE MARKET:-MARKET ARES IS
SCATTERED THEN HE SHOULD USE THE MIDDLEMEN
•
COMPEITIOR’S CHANNEL
•
INSTITUTIONAL FACTORS
1. THE FINANCIAL ABILITY OF CHANNEL
2. THE
PROMOTIONA; ABILITY OF THE CHANNEL MEMBER
3. THE POST SALE
SERVICE ABILITY
•
UNIT FACTORS
•
THE FIRM’S OWN STRENGTH AND WEAKNESSES HAVE
DEEP IMPACT ON CHANNEL SELECTION DECISION
- THE COMPANY’S
FINANCIAL POSITION:-
- STRONG
FINANCIAL BACKGROUND CAN HELP DEVELOP ITS OWN CHANNEL
•
THE EXTENT OF MARKET CONTROL DESIRED:-MARKET
CONTROL IMPLIES THE ABILITY OF THE COMPANY TO BEND THE BEHAVIOR OF THE CHANNEL
MEMBERS TO THE WILL OF THE MGMT. SUCH
CONTROL MAY BE RESALE PRICE MAINTENANCE,TERRITORIAL RESTRICTION AND QUOTA LIKE.
THE DESIRE TO HAVE FULL CONTROL OVER CHANNEL MEMBERS IS IN LINE WITH THE IDEA
OF DIRECT CHANNEL
- THE COMPANY
REPUTATION:-A REPUTED COMPANY NEED NOT GO TO INTERMEDIARY INSTEAD THE
INTERMEDIARY ARE EAGER AND WANT TO SELL THE PRODUCTS OF THE RELATED
COMPANY
- THE COMPANY’S
MARKETING POLICIES:-THE COMPANY USING SKIMMING POLICY WHERE MARGINS ARE
HIGH PREFERS DIRECT CHANNEL AS COMPARED TO PRICE PENETRATION POLICY WHERE
IT HAS LARGE MAY OPT FOR LONGER CHANNEL
•
THE FACTORS GOVERNING THE CHOICE OF AN
INTERMEDIARY
•
ECONOMIC FACTORS:-
1. DURING BOOM :
A PERIOD OF PROSPERITY EVERY ONE IS WILLING TO COOPERATE AND READY TO WORK
2. DURING THE
PERIOD OF SLUMP:-INTERMEDIARY TRY TO SLUMP THE INTERMEDIARY TRY TO BE STRINGENT
AS THEY FIND IT DIFFICULT TO MOVE THE GOODS
•
THE LEGAL RESTRICTION:-THE
LEGISLATIVE RESTRICTION IMPOSED BY THE GOVERNMENT BOTH SATE AND CENTRAL HAVE
IMPACT OF GIVING FINAL SHAPE TO CHANNEL OF DISTRIBUTION
•
FISCAL POLICIES:-
•
THE FINANCIAL POSITION OF THE INTERMEDIARY
•
ADDITIONAL FACILITIES : LIKE AN INTERMEDIARY
EQUIPPED WITH OPERATIONAL FACILITIES LIKE GODOWN,DELIVER
VANS,AFTER SALE SERVICE EQUIPMENT
No comments:
Post a Comment