ASUMEN, TRICHE P.

DISTRIBUTION MANAGEMENT
BSBA MM 2-6 MODULE 4 Ma'am Teresita Fernandez

Pre-assessment: Fill the blank with the appropriate word/s to make the sentence
correct.5 pts.

1. A Marketing channel is a medium by which goods and services are made

available to the customers for use and consumption.
2. Franchise/ Franchising is offering the right to sell other company’s goods and
services in an area.
3. Dual Distribution Channel is a less known form of marketing channel that
allows manufacturer’s or wholesaler to reach the end-user by using more than
one distribution channel.
4. Merchants and agents are major types of marketing intermediaries.
5. Place refers to “placing products and services within the reach of the consumer.”

Evaluation/Activity: Answer the following questions directly and concisely. 15 pts.

1. Why is there a need for marketing intermediaries? 5 pts.

-Marketing intermediaries, also known as middlemen, are crucial for various
reasons:
Improved Efficiency: They help streamline the process from production
to consumption, making it more efficient. They buy in large quantities from
producers, which can reduce costs and increase the speed of distribution.
Better Assortment of Products: Intermediaries often deal with a variety
of products from different producers. This allows them to offer a wider range of
products to consumers, enhancing the shopping experience.
Routinization of Transactions: Intermediaries help standardize
transactions, making them more predictable and easier to manage.
Easier Searching: They bridge the gap between producers and
consumers, making it easier for both parties to find what they’re looking for.
Producers can more easily find a market for their goods, and consumers can
more easily find the goods they want.

2. Enumerate the major types of marketing intermediaries? 10 pts.

Now, let’s look at the major types of marketing intermediaries.The major
types of marketing intermediaries include:

Agents and Brokers: These intermediaries represent various

manufacturers in the marketing channel process and serve to facilitate sales by
assisting in the negotiation processes of the buying and selling of goods. They
manage the supply of the product without owning it.
Wholesalers and Distributors: They buy large quantities of
products from manufacturers and then distribute smaller quantities to retailers.
They play a crucial role in the distribution channel by making products available
in the right place, at the right time, and in the right quantities.
Retailers: Retailers sell products directly to the end consumers.
They are the final link in the distribution chain. Retailers can be brick-and-mortar
stores or online platforms.
Specialized Intermediaries: These intermediaries specialize in
specific areas of the distribution process. They might provide specialized
services such as transportation, storage, and so on.
Pre-Assessment: Identify the following terms in 2 short sentences.

1. Middlemen: Middlemen are intermediaries involved in the distribution process,

facilitating transactions between producers and consumers. They can be wholesalers,
retailers, agents, or brokers.
2. Agent: An agent is an intermediary who represents either the buyer or the seller,
usually on a commission basis. They do not take title to goods, but simply facilitate
exchanges between two parties.
3. Wholesaler: A wholesaler is an intermediary entity in the distribution channel that
buys in bulk and sells to resellers rather than to consumers. They often specialize in
one type of product or industry.
4. Broker: A broker is an independent agent who brings buyers and sellers together.
Brokers typically have no continuing relationship with the buyer or seller but negotiate
contracts between the two parties.
5. Jobber: A jobber is a type of middleman who buys from manufacturers (or other
suppliers) and sells to retailers. Jobbers typically operate in specific industries or
markets.

Evaluation/Activity: Categorizing the major functions performed in channels of

distribution as transactional function, logistical function and facilitating function, fill up
the specific function of each of the channels below: 10 pts.

Major Functions Performed in Channels of Distribution

1. Transactional Function:
a) Buying: Agents and brokers are typically involved in this function, as they
negotiate purchases on behalf of other businesses.
b) Selling: Wholesalers and retailers are responsible for selling, as they
interact directly with customers.
c) Risk taking: This is often the role of the wholesaler or retailer, who takes
on the risk of not being able to sell the products they’ve bought.
2. Logistical Functions:
a) Assorting: Wholesalers often perform this function, creating product
assortments from various sources to supply to retailers.
b) Storing: Warehouses and distribution centers are typically responsible for
storing products.
c) Sorting: This is often done by wholesalers or distribution centers, who
organize products for distribution.
d) Transporting: Transport companies or logistics providers usually perform
this function, moving goods from one location to another.
3. Facilitating Function:
 a) Financing: Banks or other financial institutions often provide this service,
providing necessary funds for channel operations.
b) Grading: This often falls to agents or brokers, who evaluate the quality and
condition of products.
c) Marketing Information and Research: Marketing agencies or in-house
marketing departments typically handle this, gathering and analyzing
information about market conditions, consumer behavior, and product
performance.

Pre-Assessment: Essay: in 5 short sentences, answer the questions below: 10 pts.

1. Enumerate four (4) factors which help the firm achieve its objectives.
Firm Objectives: Four factors that help a firm achieve its objectives include: a
clear definition of objectives, which provides direction; effective leadership, which
guides and motivates employees; a strong organizational culture, which aligns individual
goals with the firm’s objectives; and efficient resource allocation, which ensures that
resources are used effectively to achieve the firm’s goals.

2. Explain the concept of mega selling.

Mega Selling: Mega selling refers to marketing strategies that go beyond
traditional buyer-seller relationships. It involves managing and controlling external
factors such as political, legal, and technological elements that influence the business
environment. Mega selling also considers third parties that can influence or block
transactions, such as governments, banks, and other influential groups.
Evaluation/Activity: Answer the following questions in two short sentences. 10 pts.

1. What are the two types of exhibition, explain each one.

-Types of Exhibition: There are many types of exhibitions, but two common
ones are trade exhibitions and art exhibitions. Trade exhibitions are public events
where businesses showcase their products or services to potential customers,
usually in a convention center. Art exhibitions, on the other hand, are events
where artists display their works to the public, often in a gallery or museum.
2. Give the advantages of exhibition on the seller’s and buyer’s side.
-Advantages of Exhibition: For sellers, exhibitions provide an opportunity to
meet face-to-face with potential customers, which can lead to stronger
relationships and increased sales. They also offer a platform for showcasing new
products or services. For buyers, exhibitions offer the opportunity to learn about
the latest products and trends, compare offerings from different sellers, and
make informed purchasing decisions.
Pre-Assessment: Enumeration: Answer the following questions with clarity: 10 pts.

1. Enumerate the seven (7) steps of the channel planning process.

- 1. Planning Premise or Mission Statement
2. Situation Analysis
3. Opportunities and Obstacles
4. Goals and Objectives
6. Action Plans and Responsibilities
7. The Profit Plan
2. Give three (3) important methods used to control channel members.
- 1. Selecting Channel Members
2. Managing and Motivating Channel Members
3. Handling Channel Conflict

Evaluation/Activity: In three paragraphs of five sentences each, make a historical

marketing management of Avon emphasizing the highlighted word/s herein. 20 pts.

Research on Avon’s Distribution Channels, including background note, and its

product library. Since, it was a pioneer in direct selling in 25 years, trace the evolution
of the direct selling model and mention the channel conflict it faced up to date.

- Avon, a pioneer in direct selling, has a rich history in marketing management.

Founded in 1886 by David H. McConnell, Avon initially started as a perfume company.
Over the years, Avon evolved its distribution channels, becoming one of the largest
direct sellers of beauty products worldwide. The company's primary distribution channel
was direct selling, with a network of 6.4 million active sales representatives who sold
products directly to consumers through door-to-door sales. In recent years, Avon has
integrated retail and online channels into its distribution model. This integration has
provided Avon with a competitive advantage in the cosmetics industry. However,
managing the balance between online and retail channels has posed challenges in
terms of channel conflict. Avon must carefully navigate this conflict to avoid
cannibalizing sales or creating competition between the different channels.To address
channel conflict, Avon needs to ensure that its online and retail channels complement
each other rather than compete. By providing unique offerings and experiences through
each channel, Avon can create a seamless and integrated customer journey.
Additionally, Avon can improve its distribution model by leveraging data and analytics to
understand customer preferences and optimize its channel strategy for better
penetration in the US and other countries. Overall, Avon's distribution channels have
played a crucial role in its success over the years. From its origins in direct selling to the
integration of retail and online channels, Avon has continuously adapted its distribution
strategy to meet the evolving needs of its customers and stay competitive in the beauty
industry. -The End-

Pre-Assessment: Essay: 5 pts.

 1. Explain how channel conflict helps the organization solve their problems. Cite an
example.
-Channel conflict, although it may seem counterintuitive, can actually help
organizations solve their problems in various ways. One example is when there
is conflict between different channel partners, such as manufacturers and
retailers. This conflict can arise due to disagreements over pricing, promotion, or
distribution strategies. However, through open communication and negotiation,
organizations can address these conflicts and find mutually beneficial solutions.
For instance, by discussing the concerns and needs of each channel partner,
they can develop a compromise that satisfies both parties. This can lead to
improved collaboration, increased trust, and ultimately, better overall
performance in the distribution channel.

To manage channel conflicts effectively, organizations can employ several

methods. Firstly, they can establish clear and transparent communication
channels among all channel partners. This allows for open dialogue and the
timely resolution of any conflicts that may arise. Secondly, organizations can
implement effective channel management strategies, such as setting clear
guidelines and policies for channel partners to follow. This helps to align their
goals and minimize potential conflicts. Additionally, organizations can invest in
technology and systems that facilitate efficient coordination and information
sharing among channel partners. This enables smoother collaboration and
reduces the

Evaluation/Activity: Essay: Answer the question below in 5 short sentences. 10 pts.

1. What are the methods of managing channel conflicts? Elaborate.

-Evaluating the effect of conflict is crucial for organizations to understand its
impact on their distribution channels. By assessing the consequences of
conflicts, organizations can identify areas of improvement and implement
necessary changes.
2. Give the importance of evaluating the effect of conflict.
- Evaluating the effect of conflict helps organizations gain insights into the
underlying causes and patterns of conflicts, enabling them to develop strategies
to prevent future conflicts. Furthermore, it allows organizations to assess the
financial and operational impact of conflicts, helping them make informed
decisions on how to allocate resources and manage their distribution channels
more effectively. Overall, evaluating the effect of conflict provides organizations
with valuable information to enhance their channel management practices and
maintain healthy and productive relationships with their channel partners.

-The End-