Distribution Channel Strategies: Wholesale, Retail & Market Coverage
Strategy for Position and Role in the Distribution Channel:
- Wholesale: Self-cash and carry or wholesale (Makro), Rack-jobbers or wholesalers shelf.
- Retail-Convenience: (OPENCOR)-free establishments or Duty Free Shop (located in shopping areas or international seaports and airports).
- Other: Brokers, commission agents, traveling salespersons.
Commercial Formats:
- Independent: Independent retailers, independent wholesalers.
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Spatial Association:
- Shopping centers open (Terrace Center)
- Shopping center closed: (Illa Diagonal)
- Precincts commercial business parks, or Factory Outlet Centers Centers (Rock)
- Municipal Markets, belong to municipalities. (Buckland)
- Stores. (Pedralbes center)
- Central Wholesale Market (mercas. (Mercabarna)
- Markets in origin (mercos) and boxes. (Mercolleida)
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Partner:
- Buying groups, purchasing, central services (basic)
- Voluntary chains (Spar)
- Cooperatives retailers and consumers (Eroski)
- Dealers (Seat)
- Franchising (McDonald)
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Integrated:
- Chain sucursalista (Cortefield)
- Major surfaces: hypermarkets (Aki)
- Stores, warehouses popular (Corte Inglés)
- Supermarkets (Good prices)
- Establishments off (Day)
- Category Killers (Ikea)
Strategy with Possession in the Channel:
Direct distribution (channel itself) implies the absence of intermediaries between supplier and customer. Using distribution channels themselves (self-distribution).
Main factors: cost, the unit price of the product, concentration of customers, complexity of product information. The product arrives with the optimum conditions agreed upon.
Indirect Distribution (external channel) assumes the existence of intermediaries and distribution channels to serve outside customers (distribution employed). We disengage from marketing the product. Principal factor: for economic reasons, for the standardization of products, by potential customers to purchase frequency, mixed Distribution: direct and indirect.
According to Channel Pressure:
- Push: Means pushing through the dealer discounts, payment facilities, etc.
- Pull: Involves pressing the consumer to pressure the retailer.
- Joint
Market According to Coverage:
- Intensive distribution: Desired that the product is present in most of the points of sale to get the maximum sales volume. Difficult to control the distribution channel. Brand image is not appropriate. Sales per point of sale.
- Exclusive distribution: The product is sold in one point of sale within a given geographical area. Appropriate in order to obtain a certain image of the brand. Certain manufacturers control over the channel.
- Selective distribution: We sell the product in a certain number of points within a particular geographical area. For businesses with good market share. Certain image distributor. Choice based on the services offered by the distributor to the customer, innovation capacity at the point of sale, selected establishments with a correct return.
Inconveniences and Benefits for the Franchiser:
- Increase your net distributive.
- Ease of growth of turnover.
- Control of their products and services.
- Reducing financial risk.
- Maintenance of the same image.
- Absence of large management costs.
- Diversity of incomes.
- Tensions based on the results obtained.
- Requires very detailed tracking.
- Loss of confidentiality.
- You cannot sell their products through other channels.
Inconveniences and Benefits for the Franchisee:
- Chance of being an entrepreneur.
- Take advantage of brand recognition.
- Exploiting a valid and tested commercial formula.
- Receives all necessary support to execute their work.
- Total dedication to sales.
- Door open to financial institutions.
- Access to training and information.
- Future depends on good management or bad franchisor.
- As well as other franchisees.
- You may not modify aspects of the overall management of the business.
- You cannot voluntarily transfer the business.
- Paying a few rights of entry whose business is not the owner.