Explain the nature and scope of cHannel management NCSCOS 4.08 A

What is channel management? Who are its members? The process of balancing allocation of product inventory and pricing across distribution channels. Channel members are anyone involved in the channel management process

How do channel members add value? Business use intermediaries to move their merchandise through the country and the world The use of intermediaries results from their greater efficiency in making goods available to target markets Offers the firm more than it can achieve on its own through the intermediaries

What are channel functions?

Channel market tasks Group 1 – Manufacturer Group 2 - Wholesaler Marketing Packaging Financing Group 2 - Wholesaler Storage Delivery Group 3 – Retailer Merchandising Personal Selling Channel market tasks The tasks are handled by different groups

When will a channel be most effective? When each member is assigned tasks it can do the best All members cooperate to attain overall channel goals

What is the difference between horizontal and vertical conflict? Horizontal Conflict Occurs among firms at the same level of the channel (ex. Retailer to retailer) Vertical Conflict Occurs between different levels of the same channel (ex. Wholesaler to retailer)

Channel management decisions Selecting Channel Members Identify characteristics that distinguish the best channel members Managing and Motivating Channel Members Partner relationship management (PRM) is key Evaluating Channel Members Performance should be checked against standards

Channel management decisions Analyze Consumer Needs Set Channel Objectives Identify Major Alternatives Types of intermediaries Number of intermediaries Responsibility of intermediaries

Channel management in a nut shell The customer is the puzzle. You need to work with people to put the puzzle together to give the customer what they want.