GLOBAL MARKETING CHANNELS ANDPHYSICAL DISTRIBUTION

LEARNING OBJECTIVE:
1. Identify and compare the basic structure options for consumerschannel industrial
channels
2. List guidenlines companies should follow when choosing channel intermediaries in
the global market
3. Describe the differernt categories of retail operators that are found in various past
of the words
4. Compare and contract the six major international transportation modes and
explain how they vary in terms of realibility, accestability and other performance
metrics
 DISTRIBUTION CHANNELS: OBJECTIVE, TERMINOLOGY, AND
STRUCTURE

The major categories of channel utility:place utility, time utility, form utility, information utility
Distribution channels, are systems that link manufacturers to customers:
1. Business -to-consumers marketing ( b-to-c or B2C)
2. Business- to-business ( b-to-b or B2B)
B-to-C or B2C
Consumers Product and Service
Marketing Channel alternatives:
Consumer product
 B-to-B or B2B
INDUSTRIAL PRODUCTS
 ESTABLISHING CHANNELS AND WORKING WITH CHANNEL INTERMEDIARIES

Seven specific guidelines to help prevent such poblems from arising:

1. Select distributor, Don’t let them select you.
2. Look for distributors capable of developing markets, rather than those with a few good customer
contacts.
3. Treat local distributors as long-term partners, not temporary market entry vechicles.
4. Support market entry by committing money, managers, and proven marketing ideas
5. From the start maintain control over marketing strategy
6. Make sure distributors provide you with detailed market and financial performance data
7. Build links among national distributors at the ealiest opportunity
GLOBAL RETAILING
Global retailing is any retailing activity that national boundaries.
1. TYPE OF RETAIL OPERATIONS
a. Department store: literally have several department under one roof, each representing
distinct merchandise line and staffed with a limited number of sales people
2. SPECIALITY RETAIL: Over less variety than department store
3. SUPERMARKET: are departmentalized, single –story retail estabilishment that over a variaety of food(
produce, baked goods, meats)
4. CONVENIENCE STORES:offer some of the same products as supermarket,but the merchandise mix is limited
to high turn-over convenience and impulse product.
 GLOBAL RETAILING MARKET EXPANSION STRATEGIES

Four Entry strategies indicat by:

1. Organic growth occurs when a company uses its own resources to open a store on a green-field site or to acquire one or
more existing retail facilities from another company.
2. Franchising, shown in quadrant C of Figure 12-4, is the appropriate entry strategy when
barriers to entry are low yet the market is culturally distant in terms of consumer behavior or
retailing structures.
3. Acquisition is a market entry strategy that entails purchasing a company
with multiple retail locations in a foreign country. This strategy can provide the buyer with quick
growth as well as access to existing brand suppliers, distributors, and customers.
4. Joint ventures and licensing were examined in detail in Chapter 9. Global retailers
frequently use these strategies to limit their risk when targeting unfamiliar, difficult-to-enter
markets. For example, Barneys New York licensed its name to Barneys Japan for a period of
10 years; Saks Fifth Avenue has licensed stores in the Middle East. In some countries, local
regulations mandate use of joint ventures.
 Physical Distribution, Supply Chain and Logistic
Managemen
1. Ordering Processing

2. Warehousing
Warehouses are used to store goods until they are sold; another type of facility, the distributioncenter, is
designed to efficiently receive goods from suppliers and then fill orders for individualstores or customers.
Modern distribution and warehousing is such an automated, high-techbusiness today that many
companies outsource this function.
3. Inventory Management
Proper inventory management ensures that a company neither runs out of manufacturing
compo-nents or finished goods nor incurs the expense and risk of carrying excessive stocks of
these items. Another issue is balancing order-processing costs against inventory-carrying costs.

4. Transportation
Finally, transportation decisions concern the method, or mode, a company should utilize when moving products
through domestic and global channels.