Chapter 16

Supply Chain and Channel

Management

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 Learning Objectives

Learning Objective 16.1 Understand the importance of

marketing channels and supply chain
management.

Learning Objective 16.2 Understand the difference

between direct and indirect marketing channels.

Learning Objective 16.3 Describe how marketing

channels are managed.

Learning Objective 16.4 Describe the flow of information

and merchandise in the marketing channel.

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 Supply Chain Management

Jump to Appendix 1 long 3

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 Marketing Channels Add Value (1 of 2)

Each participant adds value

Factory to consumer would require more

transactions than factory to store to consumer.

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 Marketing Channels Add Value (2 of 2)

Reduce number of transactions

Increase value for consumers

More efficient and effective

http://www.youtube.com/watch?v=NeK5ZjtpO-M

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 Marketing Channel Management Affects
Other Aspects of Marketing

Meeting customer expectations

Fulfilling delivery promises

Reliant on an efficient supply chain

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 Designing Marketing Channels

Jump to Appendix 2 long

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 Types of Vertical Marketing Systems

Administered Contractual
vertical marketing vertical marketing
system system

Corporate vertical
marketing system

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 Power

Jump to Appendix 3 long 9

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 Managing Marketing Channels and Supply
Chains Through Strategic Relationships

Common
Goals

Open Interdependence
Communications

Mutual Strategic Credible

Trust Relationships Commitments

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 PROGRESS CHECK (1 of 3)

1. What is the difference between an indirect and a

direct marketing channel?
2. What are the differences among the three types
of vertical marketing systems?
3. How do firms develop strong strategic
partnerships with their marketing channel
partners?

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 Making Information Flow
through Marketing Channels

Jump to Appendix 4 long 12

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 Data Warehouse
Electronic Data Interchange

Cycle
time

Easily Quality of
analyzed communications
and used

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 Vendor-Managed Inventory

Manufacturer is responsible for inventory levels.

Data shared via EDI.

Manufacturer replenishes inventory

in quantities that meet retailers
immediate demand.

Can reduce vendors and retailers costs

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 PROGRESS CHECK (2 of 3)

1. What are the marketing channel links associated

with each information flow?
2. How do marketing channel members use data
warehouses to make decisions?
3. What is EDI and how is it used?
4. Why do some marketing channels use VMI and
others do not?

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 Making Merchandise Flow through
Marketing Channels

Jump to Appendix 5 long 16

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 The Distribution Center

Management of inbound transportation

Receiving and checking

using UPC and RFID

Storing and Cross-Docking

Getting Merchandise Floor Ready

Preparing to ship

Shipping to store
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 Inventory Management
through Just-In-Time Systems

Also known as quick response (QR)

Less merchandise on a more frequent basis

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 PROGRESS CHECK (3 of 3)

1. How does merchandise flow through a typical

marketing channel?
2. Why have just-in-time inventory systems
become so popular?

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 Marketing
Chapter 16
The End

The End

McGraw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of McGraw-Hill Education.