By :Nikita PandayaVikram Kannad

Chirag ShahHarsha SilanZamir Khan

Channel Distribution Management

To :Prof. Devang Patel

Flow of Presentation

Introduction: Value NetworkingMarketing Mix and DistributionRole of channel distributionChannel level Channel flowChannel design decision Sales force and channel managementChannel conflictLogistic function Factors Influencing Channel Distribution

IntroductionBefore channel distribution marketer focus

Value networking.

Three type of value network channels.1. Sale value network channel2. Delivery value network channel3. Service value network channel

Quality of value network

Distribution channel

The path through which goods and services travel from the vendor to the consumer or payments for those products travel from the consumer to the vendor Each intermediary receives the item at one pricing point and movies it to the next higher pricing point until it reaches the final buyer.

Pattern/intensity of Distribution

Intensive Distribution

Selective Distribution

Exclusive Distribution

Marketing mix and distribution channels

Marketing mix includes Place, Product, Price, and Promotion.

These 4P’s are most important in the distribution of the products in the markets through different channels to the final customer or users.

Place , price and promotion of the products are important when manufacturer is providing products to the different intermediaries.

Marketer have to follow different strategies for selling products to the final users.

Role of Distribution Channel The main role of the channel distributers is to

provide goods to the consumers in the similar manner as manufacturer are providing to the concern distributers

Function of Channel DistributionInformationCommunicationNegotiationOrderingFinancingRisk takingPhysical distributionPaymentTransfer

Channel Levels of Consumer good

There are different 4 types of channel level through them the products are passing and reach to the consumers.

0-level channels

MANUFACTURER• Service provider

customer

1-level channel

CUSTOMER

DEALERMANAN AUTOLINK

MANUFACTURERMARUTI SUZUKI

CUSTOMER

DISTRIBUTORVIJAY SALES

MANUFACTURERSONY

2-Level Channels

CONSUMER

RETAILERVIJAY CORNER

DISTRIBUTORNARANPURA VISHRAM

BAUG

MANUFACTURERAMUL

CONSUMER

RETAILERVIJAY SALES

DISTRIBUTORRAMESH CORPORATION

MANUFACTURERAPPLE

3-Level Channels

CONSUMER

RETAILER

WHOLESALER

HINDUSTAN UNILEVER LTD.

MANUFACTURER

Flow of channelsPhysical flow:

Payment flow:

Suppliers Suppliers

Customers Customers

Transporters, warehouse

Manufacturer Manufacturer

Transporters, warehouse

Transporters, warehouse

Dealers Dealers

Suppliers Suppliers

Customers Customers

BANKManufacturer Manufacturer BANK

BANK Dealers Dealers

Information flow:

Suppliers Suppliers

Customers Customers

Transporters, bank, warehouse

Manufacturer Manufacturer

Transporters, bank, warehouse

Transporters, bank, warehouse

Dealers Dealers

Title flow: brand name, value

Promotion flow: advertising to customer

Suppliers Suppliers Manufacturer Manufacturer

Dealers Dealers Customers Customers

RISK IS TRANSFERRING RISK IS TRANSFERRING

Suppliers Suppliers

Customers Customers

Advertising Agency

Manufacturer Manufacturer

Advertising Agency

Advertising Agency

Dealers Dealers

B2B channel Distribution

Industrialdistributors

Man

ufac

ture

r

Con

sum

er

Manufacturer’srepresentative

Manufacturer’ssales branch

Channel design decision Analyzing consumer service needs

Setting channel objectives and constraints

Identifying major alternatives

Evaluating the major alternatives

Sales Force and Channel Management

SELECTING

TRAINING

MOTIVATING

EVALUATING

Channel conflictChannel conflict is conflict and

mismanagement between intermediaries which are present between manufacturer and

consumer.

Two type of channel conflict:1. Vertical channel conflict2. Horizontal channel conflict

Logistic ManagementOrder processing

Warehousing & Inventory

Transportation

Order Processing of Manan Autolink

Sanand Branch Dholaka Branch Chandkkheda branch

Gurukul Branch

Head office (Vijay cross road)

Head office (Vijay cross road)

MarutiWarehouse

MarutiWarehouse

Manesar manufacture unit

Manesar manufacture unit

Warehousing & inventoryThe Manan Autolink has a warehouse in

the Pirana, Kamod, at Ahmedabad. They are keeping 400 cars as a stock. First date of the every month they are

ordering the cars as per the target. Maruti is dispatching cars on the 1st and

16th date of every month (1/2 on each date of the order) to the Manan Autolink.

As per the requisition of customer, Manan AutoLink distributes the cars to other branches.

Factors influencing Channel DistributionParameters Short Channel Long Channel

Market Factors • Business user • Geographically concentration • External technical knowledge • Large orders

• Consumers• Geographically diverse • Little technical knowledge • Small order • Durable

Product factor • Perishable • Complex • Expensive

• Durable • Standardized • Inexpensive

Cont….Parameters Short Channel Long Channel

Producer factors • Broad product • Limited product line

• Channel control important • Channel control not important

Competitive factors • Manufacturing feels satisfied with marketing intermediates performance in promoting product

• Manufacturing feels dissatisfied with marketing intermediaries performance in promoting product