Download - 3.05 Channels of Distribution
![Page 1: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/1.jpg)
3.05 Channels of Distribution
![Page 2: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/2.jpg)
Textbook
Review pages 450 - 451
![Page 3: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/3.jpg)
What is distribution?
The moving or transferring of the ownership of goods and services from the producer to the consumer
![Page 4: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/4.jpg)
What is a channel of distribution?
The path (channel) a product travels from the producer (manufacturer) to the ultimate consumer
![Page 5: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/5.jpg)
MARKETING MIX
Remember the 4 P’s of Marketing?PriceProductPlacePromotion
DISTRIBUTION = PLACE
![Page 6: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/6.jpg)
Channel management tasks
MarketingPackagingFinancingStorageDeliveryMerchandisingPersonal selling
![Page 7: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/7.jpg)
Channel management decisions
Select channel membersManage and motivate channel membersEvaluate channel members
What is the best means to distribute the product?
![Page 8: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/8.jpg)
Channel design decisions….
Analyze customer needsSet channel objectivesIdentify major alternatives
Types of intermediariesNumber of intermediariesResponsibilities of intermediaries
SO……
![Page 9: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/9.jpg)
Who is an intermediary (middleman)?
Channel members who assist the producer in getting the goods and services to the final user
![Page 10: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/10.jpg)
The various intermediaries include:
Wholesalers Rack jobber Drop shipper
Retailers Brick-and-mortar Non-store
Agents
![Page 11: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/11.jpg)
Wholesalers
Companies that purchase large quantities from manufacturers, store products in warehouses and sell them to other businesses.
Example: BiLo buys their canned vegetables from Del Monte or Green Giant manufacturers
![Page 12: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/12.jpg)
Types of wholesalers
Rack jobber: A wholesaler that provides racks filled with merchandise in space that is leased from retailers.
Ex. Rack jobber provides displays with music CDs in a series of convenience stores; rack jobber and convenience stores split revenues from sales of the CDs
![Page 13: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/13.jpg)
Types of Wholesalers
Drop shipper: A wholesaler that accepts an order and ships directly from the manufacturer without taking possession of the goods.
Ex. Fuller Supply Company buys coat hangers from the manufacturer and if a dry cleaner wants 200 boxes, they will ship directly from the manufacturer
![Page 14: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/14.jpg)
Retailers
Businesses that sell products to the final user or consumer.Brick-and-mortar retail: A physical store that
sells their products directly to customers.Ex. Belk, American Eagle, CVS, Food Lion
Non-store retail: A way to reach customers through vending machines, direct mail, catalog retailing, TV home shopping, and e-tailing.Ex. Drink machines, L.L. Bean catalog, QVC, E-bay
![Page 15: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/15.jpg)
Exclusive Dealers
Situation where suppliers and distributors enter into an exclusive agreement that only allows the named distributor to sell a specific product. For example, Apple had an exclusive distribution deal with AT&T to provide the iPhone to consumers.
![Page 16: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/16.jpg)
Agents
An individual or business that connects the buyers and sellers. Agents do not own the products they sell i.e. no legal ownership of the productsEx. A REALTOR links the homebuyer to the
home seller
![Page 17: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/17.jpg)
What is a direct channel?Distribution that occurs directly from
the producer to the consumer For example: A consumer buys
apples from an apple farmer Cuts out the middleman
![Page 18: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/18.jpg)
What is an indirect channel?
Distribution that occurs through one or more intermediaries before reaching the final user
For example: The apple farmer sells his apples to Harris Teeter and Harris Teeter sells them to the consumer
![Page 19: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/19.jpg)
Indirect channel is used….
When a producer doesn’t want responsibility for the selling activities of a large retailerProducer to agent to retailer to consumer
Because wholesalers usually buy in large quantitiesProducer to wholesaler to retailer to consumer
![Page 20: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/20.jpg)
TRANSPORTATION SYSTEMS AND SERVICES
3.05
![Page 21: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/21.jpg)
Physical distribution is…Organizing and moving products
through the channels aka: Logistics = ordering,
transporting, storing, handling and inventory control
The 3rd largest expensefor most businesses
#1 Materials #2 Labor
![Page 22: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/22.jpg)
Physical distributionNeeds to be as efficient and cost effective
as possibleNeeds to be coordinated with other
business functions such asPurchasingFinanceProductionPackagingPromotion
![Page 23: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/23.jpg)
Transportation is…
Physically moving from Place A Place B
Methods include:Trucking or motor carriers Railroads Marine shipping Pipelines Air cargo services
![Page 24: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/24.jpg)
Transportation is…
Trucking or motor carriers: tractor trailersCommon carriers – provide transportation services to
any business in their operating area for a fee; multiple shippers may be consolidated into single truckloads
Contract carriers – for-hire carriers that provide equipment and drivers for specific routes, according to agreements between carrier and the shipper; less flexibility; one-time or continual basis
Private carriers – transport for an individual business; more expensive = more control
Exempt carriers – carry agricultural products; rates are lower
![Page 25: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/25.jpg)
Transportation is….Intermodal combines two or more transportation
modes to maximize advantagesPiggyback service is carrying loaded truck trailers on
railroad flatcars; trucks take trailers to final destinationRailroads: move heavy and bulky freight
Coal, steel, lumber, grain, equipment; along rail linesTon mile is moving 1 ton (2,000 lbs) 1 mileCarload is minimum # of lbs. to fill a boxcar
Marine Shipping: within US and around world barges transport steel, iron ore, and grain; tankers;
merchant vesselsInland, intracoastal and international waterways
![Page 26: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/26.jpg)
Transportation is…Pipelines: transport oil and natural gas
BP owns pipelines that move crude oil from Alaskan oil fields to the refineries
Product moves slowly but continuouslyAir cargo: High value, low-weight and
time-critical products; + speed - costFlowers shipped by air from Hawaii to NCSeafood shipped overnight Chocolates shipped from France
![Page 27: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/27.jpg)
A transportation company…
Help move small packages from A to B
For example: US Postal Service
![Page 28: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/28.jpg)
A transportation company…
UPSFedEx
Private companies that combine shipments from several businesses to help reduce costs to those businesses
![Page 29: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/29.jpg)
Freight forwarders
Private companies that combine less-than-carload or less-than truckload shipments from several different businesses and deliver them to their destinations.
Provide logistics expertise to companies
![Page 30: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/30.jpg)
INVENTORY STORAGE3.05
![Page 31: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/31.jpg)
Methods to store merchandise…Storage: the holding of products until
they are sold; produced in large quantities; amount of goods stored is called inventoryHarry Potter books are held until the retailers
place their order
![Page 32: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/32.jpg)
Storage is needed….
Until orders are received from customersProduction is greater than consumption or
demand decreasesCommodity storage makes agricultural
products available year-round Buy in bulkFaster delivery to customers
![Page 33: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/33.jpg)
Methods to store merchandise…
Private vs. Public WarehousesPrivate warehouse: a facility designed to meet
the needs of the owner. It may be based on size, temperature control or refrigeration; costly to build and maintain
Ex. Carol’s Linens has its own private warehouse to replenish inventory when needed
![Page 34: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/34.jpg)
Methods to store merchandise…
Public warehouse: Storage and handling facility that may be provided for any business willing to pay for the space; rent-a-warehouseSingletary Warehouse Company has a variety
of rental spaces to lease business owners. They offer refrigerated or temperature controlled space.
![Page 35: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/35.jpg)
Methods to store merchandise… Distribution center: A storage facility used
to centralize and speed up the delivery of goods and reduce storage costsJC Penney’s has a distribution center in
Atlanta to reach all stores in the southeast
![Page 36: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/36.jpg)
Methods to store merchandise…
Bonded warehouse: Private or public warehouse used to store products until federal taxes have been paid on the product(s)
U.S. Customs stores imported products
until duties have been paid
![Page 37: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/37.jpg)
Methods of handling inventory include…
Products ordered by a business are received, checked, marked (priced), and transferred
Receiving record: document used to keep track of incoming inventory
![Page 38: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/38.jpg)
Methods of handling inventory include…
Check the received merchandiseBlind check method Direct check method Spot check method Quality check method
![Page 39: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/39.jpg)
Methods of handling inventory include…
Blind check method: writing a detailed list of merchandise and its quantity. This list is then compared to the actual invoice. This method is time consuming but is considered the MOST ACCURATE.
![Page 40: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/40.jpg)
Methods of handling inventory include…
Direct check method: the merchandise is verified against the invoice or purchase order
![Page 41: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/41.jpg)
Methods of handling inventory include…
Spot check method: Merchandise is randomly checked for quality and quantity.
![Page 42: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/42.jpg)
Methods of handling inventory include…
Quality check method: Merchandise is inspected for workmanship and making sure there is no damage to merchandise.
![Page 43: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/43.jpg)
Methods of handling inventory include…When merchandise has been received
and checked, other information must be marked on the merchandisePlacing the selling price on the merchandise
Cumberland = 1,2,3,4,5,6,7,8,9,0UPC (universal product codes)
Scanned at check out
Once marked, transferred to selling floor
![Page 44: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/44.jpg)
Inventory is…
Storing of merchandise before it is soldPerpetual inventory controlPhysical inventory control
![Page 45: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/45.jpg)
Inventory is…
Perpetual: Tracks inventory on a continuous basis. A company can track and know the value and quantity of products on hand at any timeHarris Teeter electronically restocks
items as they are sold; the scanner communicates to the warehouse that the item is in need of restocking
![Page 46: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/46.jpg)
Inventory is…
Physical: Stock is physically counted periodically and verified for accuracy
Sam’s Club physically counts each item in the warehouse once each year
![Page 47: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/47.jpg)
Distribution Planning
Marketing 3.05
![Page 48: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/48.jpg)
Purpose of channel membersChannel members add value to a product by
performing certain channel activities expertlyMarketingPackagingFinancingStorageDeliveryMerchandisingPersonal selling
![Page 49: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/49.jpg)
Distribution planning involves…
Decisions about a product’s physical movement and transfer of ownership from producer to consumer.
Some of the major considerations are:Multiple channelsControl vs. costsIntensity of distribution desiredInvolvement in e-commerce
![Page 50: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/50.jpg)
Multiple channels….
Some products meet the needs of both industrial and consumer markets.
J & J Snack Foods sells its pretzels, drinks and cookies using multiple channels to:SupermarketsMovie TheatersStadiumsSchoolsHospitals
![Page 51: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/51.jpg)
Control vs. CostsAll manufacturers and producers must
weigh the control they want to keep over the distribution of their products against the costs and profitability.Direct sales force – company employees are
expensive with payroll, benefits, expenses; may set sales quotas and easily monitor performance
Agents – work independently, running their own businesses; less expensive = less control; agents sell product lines that make them more money
![Page 52: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/52.jpg)
Distribution IntensityDistribution intensity is how widely a
product will be distributed; marketers want to achieve the ideal market exposureExclusive distribution – protected territories
for distribution of a product in a given geographic area; business maintains tight control over a product Ex. Franchisor legally requires a franchisee to sell only the franchisor’s productsIntegrated distribution is where the manufacturer acts
as wholesaler and retailer for its own products. Ex. The Gap sells its clothing in company-owned retail stores.
![Page 53: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/53.jpg)
Distribution Intensity
Selective distribution – a limited number of outlets in a given geographical area are used to sell the product. Very important to select channel members that can maintain the image of the product and are good credit risks, aggressive marketers and good inventory planners. Ex. Dana Buckman sells its clothing only through top department stores that appeal to the affluent customers who buy its merchandise. It does not sell in a chain megastore or a variety store.
![Page 54: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/54.jpg)
Distribution Intensity
Intensive distribution – the use of all suitable outlets to sell a product. The objective is complete market coverage and the ultimate goal is to sell to as many customers as possible, wherever they choose to shop. Ex. Motor oil is sold in quick-lube shops, farm stores, auto parts retailers, supermarkets, drugstores, hardware stores, warehouse clubs, and other mass merchandisers.
![Page 55: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/55.jpg)
Dual distribution
A manufacturer may sell its products through multiple outlets at the same time:Toll-free phone systemCompany websiteMultiple retailers
![Page 56: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/56.jpg)
Horizontal and Vertical Conflict
Horizontal Conflict: occurs between channel members at the same levelGood, old-fashioned business competitionEx: two retailers selling pet supplies compete to sell
to the same target marketVertical Conflict: occurs between channel
members at different levels within the same channelProducers and wholesalers or producers and
retailers
![Page 57: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/57.jpg)
LEGAL CONSIDERATIONS, ETHICS, CUSTOMER SERVICE AND TECHNOLOGY
3.05
![Page 58: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/58.jpg)
Legal considerationsFranchisor requirements of franchisee is
legal. Ex. McDonalds’ requires franchisees to purchase all their supplies from them; requires facilities built to corporate standards. Etc.
Closed territories - Part of an economy or market not open to new entrants or foreigners. McDonald’s won’t allow 2 McDonalds on the same corner or within a certain mileage.
![Page 59: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/59.jpg)
Anti-trust laws
Sherman Act - US federal legislation of 1890 that prohibited the creation of monopolies by outlawing direct or indirect attempts to interfere with the free and competitive nature of the production and distribution of goods. Amended by the Clayton Act of 1914.
![Page 60: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/60.jpg)
Anti-trust lawsClayton Act - US federal legislation of 1914
that amended the anti-monopoly provisions of the Sherman Act of 1890 to include prohibition of (1) price discrimination and tying arrangements, (2) sales based on exclusive-dealing contracts, (3) mergers and interlocking directorates where "the effect of such acquisition may be substantially to lessen competition, or tend to create a monopoly in any line of commerce
![Page 61: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/61.jpg)
Robinson-Patman Act of 1936
the Act prohibits sales that discriminate in price on the sale of goods to equally-situated distributors when the effect of such sales is to reduce competition. Price means net price and includes all compensation paid. The seller may not throw in additional goods or services. Injured parties or the US government may bring an action under the Act.
![Page 62: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/62.jpg)
Customer service and appropriate channel management
Ensures timely delivery of productsEffective communication is important
Order processingCorrect shipping informationCorrect productsHandling complaintsReducing the probability of complaintsNice and friendly people
![Page 63: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/63.jpg)
Bad Customer service and Channel ManagementVendor consistently has back orders
Product not available when ordered Coercion – large business threatening to
stop using a supplier unless given major concessionsTying agreement - Purchase agreement in which
the customer is forced to purchase a slow-selling or unknown brand or product with a fast-selling or well known one. Such coercion is usually illegal.
![Page 64: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/64.jpg)
Customer Service and Channel ManagementGrey-market strategy – selling product in
foreign countries for a lower price than customers can get domestically
Full-line forcing - Producer or supplier insistence that the dealer must carry the full range of products in the line. This policy may not be illegal if it can be established that it serves a legitimate business need.
![Page 65: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/65.jpg)
Slotting allowance or feeSum paid by a vendor or manufacturer to a
retail chain or establishment for (1) making room for a product on its store shelves, (2) making room for the product in its warehouse, (3) entering the product data in its inventory system, and (4) programming its computers to recognize the product's bar code. In the US, slotting fees often run up to $50,000 or more per product per store, on an annual basis. Also called slotting allowance.
![Page 66: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/66.jpg)
Use of Technology in Distribution
Some businesses have the capacity to distribute most or all of their products through the internete-commerce: Products are sold to customers
and industrial buyers through the Internet.e-marketplace
Satellite tracking = a dispatcher has current knowledge of a delivery truck’s location and destination
![Page 67: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/67.jpg)
Use of Technology in Distribution
Tracking of packageBar coding on packagePackage scanned at transition points in
distribution chainCustomer uses internet to follow package along
distribution chain; e-mail may be usedGlobal distribution: in some countries the postal
service is not reliable; package tracking facilitates global trade
![Page 68: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/68.jpg)
Use of Technology in Distribution
ProblemsCost of technologyChanging technology = updating equipmentNeed for compatible systems within and
between countries
![Page 69: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/69.jpg)
Channels of Distribution
US Post Officehttp://www.youtube.com/watch?
v=VQReRnmCaqA&feature=related&safety_mode=true&persist_safety_mode=1
UPShttp://www.youtube.com/watch?
v=2C5KDH2o28o&feature=related&safety_mode=true&persist_safety_mode=1&safe=active
![Page 70: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/70.jpg)
Extreme Engineering
http://www.youtube.com/watch?v=Eg4lnKPBcqk&feature=related&safety_mode=true&persist_safety_mode=1
![Page 71: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/71.jpg)
Ship Catastrophe
http://www.youtube.com/watch?v=8HFARxn73dk&feature=related&safety_mode=true&persist_safety_mode=1
http://www.youtube.com/watch?v=BX3kFCgvKp4&feature=related&safety_mode=true&persist_safety_mode=1
![Page 72: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/72.jpg)
Dell Computers
http://www.youtube.com/watch?v=EEhNkzdKyrw&feature=related&safety_mode=true&persist_safety_mode=1
Amazon.comhttp://www.youtube.com/watch?
v=i6H7nfHjHtY&feature=related&safety_mode=true&persist_safety_mode=1
![Page 73: 3.05 Channels of Distribution](https://reader036.vdocuments.net/reader036/viewer/2022062305/56815d91550346895dcbaa26/html5/thumbnails/73.jpg)
Coca-cola
http://www.youtube.com/watch?v=jRo8_XBCSvw&feature=related&safety_mode=true&persist_safety_mode=1&safe=active