SOUTHERN LEYTE STATE UNIVERSITY

COLLEGE OF BUSINESS AND MANAGEMENT

ASSIGNED TOPIC
IN
ELECT303

“MANUFACTURER”
John Z. Brodeth
Instructor

Mary Ann Angeline Marinay

BSE-3A student

1st Semester
A.Y. 2018-2019
OUTLINE
 Manufacturer
 Manufacturing Analytics Dos and Don’ts
 The 5 manufacturing cycle efficiency stages to examine
 Functions of a Channel
 Institutions in channels fall into three categories
 Advantages and Disadvantages to Direct Channel
 Advantages and Disadvantages to Indirect Channel
 Manufacturer to Consumer
 Should Manufacturer Sells Directly to Consumer?
 Why Manufacturer Sells Directly to Consumer?
 Manufacturer to Retailer to Consumer
 Manufacturer to Wholesaler to Retailer to Consumer
 Manufacturer to Distributor to Wholesaler to Retailer to Consumer
MANUFACTURER
 Entity that makes a good through a process
involving raw materials, components, or
assemblies, usually on a large scale with
different operations divided among different
workers. Commonly used interchangeably with
producer.
MANUFACTURING ANALYTICS DOS AND DON’TS

 DON’T spend money and time on company-

managed infrastructure and applications
 DON’T try to boil the ocean (or the lake).

 DON’T just use the same storage

mechanisms you’ve always had.
 DON’T just report on the data.

 DON’T burn down the village just to put in

a new solution.
 DON’T spend time and money to build your
analytics application from scratch.
MANUFACTURING ANALYTICS DOS AND
DON’TS
 DO look at vendor-managed infrastructure
for lower total cost of ownership.

 DO narrow your focus to high ROI targets.

 DO look beyond pie and bar charts with an
eye toward predictive analytics.
 DO be flexible and capture diverse forms of
structured and unstructured data.
THE 5 MANUFACTURING CYCLE
EFFICIENCY STAGES TO EXAMINE:

Stage 1: Concept and Development

Stage 2: Ordering Process
Stage 3: Production Scheduling
Stage 4: Manufacturing
Stage 5: Transportation
FUNCTIONS OF A CHANNEL

The primary purpose of any channel of distribution

is to bridge the gap between the producer of a
product and the user of it, whether the parties are
located in the same community or in different
countries thousands of miles apart. The channel of
distribution is defined as the most efficient and
effective manner in which to place a product into
the hands of the customer. The channel is
composed of different institutions that facilitate the
transaction and the physical exchange.
INSTITUTIONS IN CHANNELS FALL INTO
THREE CATEGORIES:

 The producer of the product: a craftsman,

manufacturer, farmer, or other extractive
industry producer
 The user of the product: an individual, household,
business buyer, institution, or government
 Certain middlemen at the wholesale and/or retail
level
FOLLOWING ARE THE MAIN ADVANTAGES
OF DIRECT CHANNEL

(1) Suitable To Small Manufacturers

(2) Success of New Product
(3) Increased Sales
(4) Personal Attention
(5) Market Information
LIMITATIONS OF DIRECT CHANNEL

(1) Problems of Recruitment and Training of

Salesmen
(2) Expensive
(3) Suitable For Limited Number of Products
(4)Limited Scope
INDIRECT CHANNEL

Functions Pros Cons

Sales force Established/branded No real loyalty partners

Good segmentation Potential conflicts

Product Established markets No product loyalty

Established programs One of many sold by the
reseller

Services Proven Experience Account control

Potential costly support

Marketing Shared marketing expenses Multiple marketing support

Financials Potentially expense Margin issues

Sharing
MANUFACTURER TO CUSTOMER

 Manufacturer makes the goods and sells them to

the consumer directly with no intermediary, such
as a wholesaler, agent or retailer. Goods come
from the manufacturer to the user without an
intermediary or middleman.

Example: RICE
a farmer may sell some produce directly to
customers.
SHOULD MANUFACTURER SELLS DIRECTLY
TO CONSUMERS?

 Most manufacturers would (at least secretly) love

to cut out the middlemen but the manufacturers
need the integrators to sell their products.
Historically, it's been too expensive and difficult
for a manufacturer to reach end users all over the
world. The integrators, therefore, became an
extension of the manufacturer's sales force in
exchange for a lucrative cut.
WHY MANUFACTURERS SOMETIMES SELL
DIRECT
 The DTC model offers several advantages. It
allows brands to gain data and deeper insight
into the behavior of customers, greater control
over marketing and ultimately, greater profit
margin. Selling directly to consumers could
reduce costs and enable brands to invest in direct
marketing that builds loyalty.

EXAMPLES: DELL COMPUTER, NIKE, UNDER

ARMOUR, L’OREAL, FUNKO
MANUFACTURER TO RETAILER TO
CONSUMER
 Purchases are made by the retailer from the
manufacturer and then the retailer sells the
merchandise to the consumer. This channel is
used by manufacturers that specialize in
producing shopping goods.

Example: clothes, shoes, furniture and fine china.

MANUFACTURER TO WHOLESALER TO
CUSTOMER
 Consumer’s can buy directly from the wholesaler.
The wholesaler breaks down bulk packages for
resale to the consumer. The wholesaler reduces
some of the cost to the consumer such as service
cost or sales force cost, which makes the purchase
price cheaper for the consumer.
 For example, shopping at some of the warehouse
clubs, the customer may have to buy a
membership in order to buy directly from the
wholesaler.
MANUFACTURER TO AGENT TO
WHOLESALER TO RETAILER TO CUSTOMER
 Distribution that involves more than one
intermediary involves an agent called in to be the
middleman and assist with the sale of the goods.
An agent receives a commission from the
producer. Agents are useful when goods need to
move quickly into the market soon after the order
is placed.
UNILEVER
COCA-COLA
REFERENCES

https://firealarmmarketing.com/2009/08/13/the-pros-and-cons-for-indirect-sales-
distribution-model/
https://sightmachine.com/blog/manufacturing-analytics-dos-and-donts/
https://www.getelastic.com/manufacturer-advantages-in-direct-to-consumer-selling
https://blog.apruve.com/the-advantages-of-a-distribution-channel-for-manufacturers
https://www.thebalancesmb.com/manufacturers-selling-directly-to-consumers-3975412
http://www.neweraconsulting.com/avoid.htm
https://smallbusiness.chron.com/differences-between-wholesalers-distributors-retailers-
30836.html
https://www.investopedia.com/terms/d/distribution-channel.asp
https://www.encyclopedia.com/history/dictionaries-thesauruses-pictures-and-press-
releases/distribution-goods-and-services
https://bib.irb.hr/datoteka/529824.Segetlija_Dujak_Mesaric.pdf
https://www.referenceforbusiness.com/encyclopedia/Ca-Clo/Channels-of-
Distribution.html
http://www_pjms_zim_pcz_plpdfpjms6distribution20channels20and20their20roles20in2
0the20enterprise.pdf