Presentation on theme: "Distribution Strategies Retailing and Wholesaling"— Presentation transcript:
1 Distribution Strategies Retailing and Wholesaling Chapter 13Distribution StrategiesRetailing andWholesaling
2 What is Retailing?All the activities involved in selling goods or services directly to final consumers for their personal, nonbusiness use.Retailers - businesses whose sales come primarily from retailing.Retailers can be classified as:Store retailers such as Home Depot, Sears, Walmart.Nonstore retailers such as the mail, telephone, and Internet.
3 Classification of Retail Stores Amount of ServiceSelf-Service, Limited-Service andFull-Service RetailersClassification of Retail StoresProduct LineLength and Breadth of the ProductAssortmentRelative PricesPricing Structure that is Usedby the RetailerRetail OrganizationsIndependent, Corporate, or ContractualOwnership Organization
4 Classification By Product Line Store Type Length and Breadth of Product AssortmentSpecialty StoresNarrow Product Line, Deep Assortment i.e. The Limited or Athlete’s FootDepartment StoresWide Variety of Product Lines i.e. Clothing, Home Furnishings, & Household ItemsSupermarketsWide Variety of Food, Laundry, & Household ProductsConvenience StoresLimited Line of High-Turnover Convenience GoodsSuperstoresLarge Assortment of Routinely Purchased Food & Nonfood Products, Plus ServicesCategory KillersGiant Specialty Store that Carries a Very Deep Assortment of a Particular LineHypermarketsHuge Superstores
5 Classification By Relative Price Higher Prices and Offer Higher-Quality Goodsand Customer ServiceRegular Prices and Offer Normal-Quality Goodsand Customer ServiceLow Prices and Offer Lower-Quality Goodsand Customer ServiceDiscountStores“Off-Priced”RetailersCatalogShowrooms
6 Classification By Retail Organization MerchandisingConglomeratesCorporateChainsFranchiseOrganizationsVoluntaryChainsRetail OrganizationsRetailerCooperatives
7 Types of NonStore Retailing Nonstore Retailing Accounts for More Than 14% of All Consumer Purchases, and May Account for 33% of All Sales by 2000.Catalogs & Direct MailDoor-to-Door RetailingDirect MarketingDirect SellingTV Shopping ShowsHome & Office PartiesOnline ShoppingAutomatic Vending
8 Key Tool of Nonprice Competition for Setting One Store Apart From Product AssortmentWidth and Depth of AssortmentQuality of ProductsProduct Differentiation StrategiesRetailer’s Product Assortment and Services DecisionsServices MixKey Tool of Nonprice Competitionfor Setting One Store Apart FromAnother.Store’s AtmospherePhysical Layout“Feel” That Suits the Target Marketand Moves Customers to Buy
9 Retailer’s Price, Promotion, and Place Decisions Price DecisionsTarget MarketProduct & Service AssortmentCompetitionPromotion DecisionsUsing Advertising, Personal Selling, Sales Promotion and Public Relations to Reach Customers.Place DecisionsShopping Centers, Central Business Districts, or Power Centers.Location, Location, Location!
10 The Future of Retailing New Retail Forms and ShorteningRetail LifecyclesGrowth of Nonstore RetailingIncreasing Intertype CompetitionThe Future of RetailingRise of MegaretailersGrowing Importance of Retail TechnologyGlobal Expansion of Major RetailersRetail Stores as “Communities”or “Hangouts”
11 What is Wholesaling?All the activities involved in selling goods and services to those buying for resale or business use.Wholesaler - those firms engaged primarily in wholesaling activity.
12 Why are Wholesalers Used? Wholesalers are Often Better at Performing One or More of the Following Channel Functions:ManagementServices & AdviceSelling andPromotingWholesalerFunctionsMarketInformationBuying andAssortment BuildingRisk BearingBulk BreakingFinancingWarehousingTransportation
13 They Don’t Take Title to Wholesaling by Sellers Types of WholesalersBrokers/ AgentsThey Don’t Take Title tothe Goods, and TheyPerform Only a FewFunctions.Merchant WholesalerIndependently OwnedBusiness that TakesTitle to theMerchandiseit Handles.Manufacturers’Sales Branchesand OfficesWholesaling by Sellersor Buyers ThemselvesRather Than ThroughIndependentWholesalers.
14 Constantly Improve Services and Reduce CostsTrends in WholesalingMust Learn to Compete Effectively OverWider and More Diverse AreasIncreasing Consolidations Will ReduceNumber of WholesalersSurviving Wholesalers Will Grow LargerThrough Acquisitions and MergersVertical Integration Will Remain StrongWill Continue to Increase ServicesProvided to RetailersGlobal Expansion