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Upstream partners include raw material suppliers, components, parts, information, finances, and expertise to create a product or service Downstream partners include the marketing channels or distribution channels that look toward the customer
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Supply chain make and sell view includes the firms raw materials, productive inputs, and factory capacity
Demand chain sense and respond view suggests that planning starts with the needs of the target customer, and the firm responds to these needs by organizing a chain of resources and activities with the goal of creating customer value
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Intermediaries offer producers greater efficiency in making goods available to target markets. Through their contacts, experience, specialization, and scale of operations, intermediaries usually offer the firm more than it can achieve on its own.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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From an economic view, intermediaries transform the assortment of products into assortments wanted by consumers Channel members add value by bridging the major time, place, and possession gaps that separate goods and services from those who would use them
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Matching
Negotiation
Physical distribution
Financing
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Risk taking
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Connected by types of flows: Physical flow of products Flow of ownership Payment flow Information flow Promotion flow
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Marketing channel consists of firms that have partnered for their common good with each member playing a specialized role Channel conflict refers to disagreement over goals, roles, and rewards by channel members Horizontal conflict Vertical conflict
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Conventional distribution systems consist of one or more independent producers, wholesalers, and retailers. Each seeks to maximize its own profits, and there is little control over the other members and no formal means for assigning roles and resolving conflict.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Manufacturer-sponsored retailer franchise system Manufacturer-sponsored wholesaler franchise system Service firm-sponsored retailer franchise system
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Multichannel Distribution systems (Hybrid marketing channels) are when a single firm sets up two or more marketing channels to reach one or more customer segments
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Evaluation
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Intensive distribution
Candy and toothpaste
Exclusive distribution
Luxury automobiles and prestige clothing
Selective distribution
Television and home appliance
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Channel systems can vary from country to country Must be able to adapt channel strategies to the existing structures within each country
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Warehousing
Inventory management
Transportation
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
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Smart shelves
Placing orders automatically
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Truck Pipeline
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Rail Air
Water Internet
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Integrated logistics management is the recognition that providing customer service and trimming distribution costs requires teamwork internally and externally
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Third-party logistics is the outsourcing of logistics functions to third-party logistics providers (3PLs)
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