Hoofdstuk 8
Physical distribution is concerned with the ways organisations get the physical
product to a point where it is most convenient for the consumer to buy it.
Logistics takes a wider view: originally based on military terminology, logistics is
concerned with the process of moving raw materials through the production and
distribution processes to the point at which the finished product is needed.
The purpose of any physical distribution method is to get the product from its
point of production to the consumer efficiently and effectively. Physical
distribution is to do with transportation methods; distribution strategy decisions
are about which outlets should be used for the product.
Transportation method is also affected by the channel of distribution, or
marketing channel.
Wholesalers perform a wide variety of functions, all aimed at making the
exchange of goods easier and more efficient. This leaves the manufacturer free
to concentrate resources on improving production efficiencies and the physical
product offering, and retailers to concentrate on providing the most effective
service for the consumer. Retailers deal with any sales that are for the customer’s
own use, or for the use of family and friends. In other words, any purchases that
are not for business needs are the domain of the retailer.The following factors
have been identified as being crucial to retail success:
• Location. Being where the consumer can easily find the shop – in other words,
where the customers would expect such a shop to be.
• Buying the right goods in the right quantities to be able to supply what the
consumer wants to buy.
• Offering the right level of service. If the service level is less than the customer
expects, he/she will be dissatisfied and will shop elsewhere. If the service level is
too high, the costs increase, and also the customer may become suspicious that
the prices are higher than they need be.
• Store image. If the shop and its goods are upmarket, so must be the image in
the consumer’s mind. As with any other aspect of the product, the benefits must
be as expected, or post-purchase dissonance will follow.
• Atmospherics – the physical elements of the shop design that encourage
purchase. Use of the right colours, lighting, piped music and even odours can
greatly affect purchasing behavior.
• Product mix. The retailer must decide which products will appeal to his/her
customers.
Channels can be led by any of the channel members, whether they are
producers, wholesalers, or retailers, provided the member concerned has channel
power.
Channel co-operation is an essential part of the effective functioning of channels.
Since each member relies on every other member for the free exchange of goods
down the channel, it is in the members’ interests to look after each other to some
extent. Channel co-operation can be improved in the following ways:
• The channel members can agree on target markets, so that each member can
best direct effort towards meeting the common goal.
• The tasks each member should carry out can be defined. This avoids
duplication of effort, or giving the final consumer conflicting messages.
Afurther development is co-marketing, which implies a partnership between
manufacturers, intermediaries and retailers. This level of co-operation involves
pooling of market information and full agreement on strategic issues.
Sometimes the simplest way to control a distribution channel is to buy out the
channel members. Buying out members across a given level (for example, a
wholesaler buying out other wholesalers in order to build a national network) is
called horizontal integration; buying out members above or below in the
Physical distribution is concerned with the ways organisations get the physical
product to a point where it is most convenient for the consumer to buy it.
Logistics takes a wider view: originally based on military terminology, logistics is
concerned with the process of moving raw materials through the production and
distribution processes to the point at which the finished product is needed.
The purpose of any physical distribution method is to get the product from its
point of production to the consumer efficiently and effectively. Physical
distribution is to do with transportation methods; distribution strategy decisions
are about which outlets should be used for the product.
Transportation method is also affected by the channel of distribution, or
marketing channel.
Wholesalers perform a wide variety of functions, all aimed at making the
exchange of goods easier and more efficient. This leaves the manufacturer free
to concentrate resources on improving production efficiencies and the physical
product offering, and retailers to concentrate on providing the most effective
service for the consumer. Retailers deal with any sales that are for the customer’s
own use, or for the use of family and friends. In other words, any purchases that
are not for business needs are the domain of the retailer.The following factors
have been identified as being crucial to retail success:
• Location. Being where the consumer can easily find the shop – in other words,
where the customers would expect such a shop to be.
• Buying the right goods in the right quantities to be able to supply what the
consumer wants to buy.
• Offering the right level of service. If the service level is less than the customer
expects, he/she will be dissatisfied and will shop elsewhere. If the service level is
too high, the costs increase, and also the customer may become suspicious that
the prices are higher than they need be.
• Store image. If the shop and its goods are upmarket, so must be the image in
the consumer’s mind. As with any other aspect of the product, the benefits must
be as expected, or post-purchase dissonance will follow.
• Atmospherics – the physical elements of the shop design that encourage
purchase. Use of the right colours, lighting, piped music and even odours can
greatly affect purchasing behavior.
• Product mix. The retailer must decide which products will appeal to his/her
customers.
Channels can be led by any of the channel members, whether they are
producers, wholesalers, or retailers, provided the member concerned has channel
power.
Channel co-operation is an essential part of the effective functioning of channels.
Since each member relies on every other member for the free exchange of goods
down the channel, it is in the members’ interests to look after each other to some
extent. Channel co-operation can be improved in the following ways:
• The channel members can agree on target markets, so that each member can
best direct effort towards meeting the common goal.
• The tasks each member should carry out can be defined. This avoids
duplication of effort, or giving the final consumer conflicting messages.
Afurther development is co-marketing, which implies a partnership between
manufacturers, intermediaries and retailers. This level of co-operation involves
pooling of market information and full agreement on strategic issues.
Sometimes the simplest way to control a distribution channel is to buy out the
channel members. Buying out members across a given level (for example, a
wholesaler buying out other wholesalers in order to build a national network) is
called horizontal integration; buying out members above or below in the
