CHAPTER 9 PLACE part three: the marketing mix

an opening challenge You are working for a French wine company. You know that Australian and American wine producers are seen as more technologically advanced and better value. How can you compete?

agenda distribution supply chains intermediaries channel design – length – breadth overseas operations marketing through the supply chain e-channels

the secrets of place (distribution)

a supply chain AQ – re-set figure type

supply chain members sellers – manufacturers – resellers – wholesalers – retailers facilitators – agents and distributors – logistics services buyers – customers – consumers – business users

key aspects of logistics management suitable storage facilities the right amount of stock good communications throughout the distribution channel suitable transport packaging that will protect the product in transit and storage (and be easy to lift and move) (Fernie and Sparks, 2004)

choosing a retail location is the right type of customer there? transport and car parking? costs? competitive outlets? complementary businesses? a suitable building? planning permission? Other legal restrictions? has there been a similar business in the area? (for chains) impact of new outlet on existing ones? does the location have the right image?

PYO farm consumer 0 level channel 0 channel design: length (photo courtesy of Dave Pickton)

farm fruit market consumer restaurant 2-level channel 1 2 channel design: length

channel design: breadth exclusive selective mass

multichannel distribution AQ – text missing

buyer-seller relationship AQ – text missing

selling overseas: two options make the products at home and export them or make the products abroad

selling overseas home country target country overseas facilities level of involvement and risk direct exportindirect export

direct export least effortmore effort and resources lowest risk option still low risk compared to overseas facilities the easiest exit strategy depends on degree of involvement little customer contactowns customer relationship gains no direct market experience builds up market experience

marketing functions along the supply chain stock holding – ensuring sufficient supply transportation information gathering communications promotion

e-channels electronic distribution b2b – order management – instant communication – supplier search b2c – e-tailing, bricks and clicks c2c – a different form of competition, e.g. eBay

summary right products, right place, right time place is concerned with the whole of the distribution function – from order to delivery channel design – levels – exclusive, selective, mass different types of intermediaries – with different roles additional complexities of overseas distribution

reference Fernie, J. and Sparks, L. (2004) ‘Retail logistics: changes and challenges’, in J. Fernie and L. Sparks (eds) Logistics and Retail Management: Insights into Current Practice and Trends from Leading Experts, 2nd edn. London: Kogan Page.