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McGraw-Hill/Irwin Understanding Business, 8e. © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. Nickels McHugh McHugh. *. *. Distributing Products Quickly and Efficiently. *. CHAPTER. 15. *. *. 1- 1. Channel of Distribution. Marketing Intermediaries

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  1. McGraw-Hill/Irwin Understanding Business, 8e © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. Nickels McHugh McHugh * * Distributing Products Quickly and Efficiently * CHAPTER 15 * * 1-1

  2. Channel of Distribution • Marketing Intermediaries • Wholesaler • Retailer • Agents/Brokers • Role of Intermediaries • Create Efficiency • Value vs. Cost

  3. Distribution Effect onYour Food Dollar (In cents)

  4. They All Started in 1962 Source: walmart.com, target.com, kmart.com; Business 2.0, June 2003

  5. U.S. and International Wal-Mart Stores 2006 US Retail Units Wal-Mart International Source: Wal-MartFacts.com, 2006

  6. Utilities Created by Intermediaries Form Time Possession Place Information Service

  7. Wholesale Intermediaries • Merchant Wholesalers • Full-Service • Limited-Function • Rack Jobbers • Cash-and-Carry • Drop Shippers • Agents and Brokers

  8. Retail Distribution Strategy • Intensive • Selective • Exclusive

  9. Supermarket Convenience Store Discount Store Department Store Category Killer Specialty Store Factory Outlet Superstores Catalog Showroom Warehouse club Identify a Retailer In Your Area

  10. Largest Mall in USA • THE MALL OF AMERICA in Bloomington, Minnesota • Large enough to hold Thirty-two 747’s • Four Gap stores • Aquarium • Full-size amusement park • More than 40 million visitors a year • (more than Disney World, Graceland and the Grand Canyon combined) Source: The Week magazine, April 2004

  11. The Wheel of Retailing 4. New Outlet Enters 1. Retail Outlet Starts • Low Price • Limited Service • Out-of-way Location • Low Price • Limited Service Passage Of Time 3. Retail Outlet 2. Retail Outlet • Higher Prices • Higher Status • Adds Service • Raises Prices • Better Location

  12. Nonstore Distribution • Electronic retailing • Telemarketing • Vending Machines, Kiosks, Carts • Direct Selling • Multilevel Marketing • Direct Marketing

  13. Top Internet Shopping Sites By Millions of Visitors in October 2005 Source: Investors Business Daily, November 23, 2005

  14. Top Internet Comparison-Shopping Sites By Millions of Visitors in October, 2005 Source: Investors Business Daily, November 2005

  15. 10 Ways to Increase Sales on eBay • Accept multiple payment options. • Take good pictures. • Write detailed, compelling descriptions. • Work to maintain your eBay feedback rating. • Provide good customer service. • Open an eBay Store. • Let them Buy It Now. • Choose Multiple listing categories and upgrade features. • Try shorter auction times. • Offer satisfaction guarantees, warranties, or returns. Source: allbusiness.com, accessed August 9, 2006.

  16. Why People Don’t Shop Online Source: Forrester

  17. Channel Cooperation • Corporate Distribution • Contractual Distribution • Administered Distribution • Supply Chain Management

  18. The Supply Chain

  19. Logistics • Physical Distribution • Inbound • Materials handling • Outbound • Reverse • Information

  20. Railroad Motor Vehicles Water Pipeline Air Intermodal Warehousing Storage Distribution Transportation & Storage Modes

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