Some businesses sell directly to their customers, while others might use a retailer or wholesaler to serve as an intermediary. [Solved] UNILEVER is therefore encouraging small retailers ... What do you mean by the place mix? Describe the factors ... In this situation, the manufacturer of medicines should take care that the distribution of his product takes place only through such middlemen who have the . Different channel design decisions in marketing ... E.g. Age Many companies decide channel split by looking at customer demographics, particularly age. The selection of channel is not an easy job. Philips Kotler defines channel of distribution as "a set of independent organisations involved in the process of making a product or service available for use or consumption". If a cosmetic producer have chosen big retail store for their sale than a particular form may like to adopt door to door selling. To determine . Why so many choices . The most significant of these factors are: Objectives of the campaign; Budget available; Research concerning client; The product; Type of message or selling appeal; Relative cost; Clutter; The potential . A company has to decide whether to adopt the same channel as that of its competitor or choose another one. Whether an organisation will adopt direct marketing channels or long channels involving number of intermediaries is a strategic decision. After deciding on the channel design, management must identify, evaluate, and recruit specific sales . Assessing the economy is a must in order to guard against stock outs or a buildup of excess inventory. Important factors affecting the choice of channels of distribution by the manufacturer are:1) Product Related Factors: The choice of channels of distribution depends upon the factors related to the product. They have great influence on the choice of a distribution channel. Below are the factors that influence the choice of the channel - Product - The first factor to be considered is the product category. Factors Affecting Channels of Distribution (v) Marketing Environment: During recession or depression, shorter and cheaper channel is preferred. Distribution Channels: Types, Functions, And Examples ... Factor # 3. For example, only a license holder can sell medicines in the market according to the law of the government. If the consumer expects credit facilities, desires to purchase all necessaries at one place one desire for the personal services of the salesman, the channel may be lengthier or shorter depends upon the capacity of providing those facilities and meeting out the needs of the customers. The nature of the company, its products, marketing intermediaries, competitors & environment is influenced the channel objectives. Verified by Toppr. Pricing Strategy: Pricing strategy influences the promotion mix in two ways. Firstly in terms of the price of the competitor's brand and secondly in terms of the margin allowed to the middle-men. Selecting the best marketing channel is critical because it can mean the success or failure of your product. 671 549 957. Nevertheless, other types of flows should not be neglected in distribution channels, so that the following definition is also possible: "Channel of distribution . Transcribed image text: Question 1 (Marks: 51 There are several factors that would influence the choice of distribution which would be (5) either Direct Channel distribution or indirect Channel Distribution. The economic environment also has an impact on the choice of promotion tools. In case of multi-point tax on the sales of products, the producers should use a shorter channel to reach the customers. One of the first elements to consider is who the intended consumer will be and what exactly they desire. Customer's buying habits also affect channels of distribution decision. The choice of channels depends on various factors. 2389 words (10 pages) Essay. • But there are some which stand out and influence channel of distribution choice in all cases. There are multiple external factors that may affect inventory control. Medium. It should be realised that the distribution channel is the Similarly, distribution channel is defined by Hill: "Distribution channel - one or more companies or individuals who participate in the flow of goods and services from the manufacturer to the final user or consumer" (Hill, 2010, 93). Company Characteristics 4. Download. It has too many major alternatives. This diversified distribution network supports unsuitable distribution channel for Unilever. The organisations do alter the budget basis their marketing strategies. Outline the benefit that saving and credit cooperative society provide to members. The manufacturer is the company that makes the product. Such companies can open and manage . Aikido; Karate; Kickboxing K1 januari 17, 2021 . Setting channel objectives. Choice of appropriate channel of distribution is a very important marketing decision, which affects the performance of an organisation. Several factors influence the channel configuration decision, including: End-user considerations; Product characteristics; Capabilities and resources of the manufacturer ; Functions and need to be performed; Availability and capabilities of channel members; Marketing Channel Management. Your chosen entrepreneur would have had to make the decision of either Direct or indirect, or possibly both. Factors that influence the channel structures and strategies available to global marketers include customer, product, middleman, and environmental characteristics. Inicio; César Febles; Actividades. Market Factors: Important market factors affecting the choice of channel of distribution include size of market, geographical concentration ofpotential buyers and quantity purchased. Materials delivery, quality, cost/price, financial position, communication . Some of the major factors affecting selection of channel are organization objectives, type of product, nature and extent of market, existing channel for comparable product, buying habits of consumers and channel availability. Companies may also use agents or brokers to facilitate the movement of products to distributors that sell those wares to the customer. (iv) What are the expectations from the channel members? Company's internal situations have direct impact on choice of marketing channel. In case the number of buyers is small, like for most industrial products, short channels are used. Both B2B and B2C companies alike need to weigh the pros and cons of each channel before choosing which one to utilize. Are there some specific expectations? 09 de agosto de 2021 | Nenhum comentário . Open in App. the incomes of millions of small-scale businesses and (4 marks) individual sellers around the world. Internal vs. external . They help you reach the customer in a way to maximise your revenue and brand awareness. 13. For example, if Nokia has selected a particular channel say Big Bazaars for sale of their hand sets, other firms like Samsung and LG have also . (3) The Nature of Middlemen: ADVERTISEMENTS: Marketing intermediaries are vital components in the distribution of goods. Types of Distribution Channels - 3 Other Types: Hybrid Distribution System, Wholesaler and Physical Distribution Type # 1. Upvote(0) Was this answer helpful? Depending on your business and your products, this series can include wholesalers, brick and mortar retailers, online marketplaces, or shipping companies that take your products directly to consumers. These factors are: (A) Product Considerations: The nature and type of product helps in determining a decision about channel of distribution. Transcribed image text: Question 1 (Marks: 51 There are several factors that would influence the choice of distribution which would be (5) either Direct Channel distribution or indirect Channel Distribution. Unit Value of the […] But if the number of buyers is large, as in case of most convenience products like soft drink, toothpaste etc . That's why distribution channels are the key factor in all the marketing strategies of any company, which will help you reach the customer in a way to maximize your revenue and brand awareness. Company Factors 4. A semi- structured questionnaire was used to collect the relevant data, while frequency So, this Types of Distribution Channels - How to Choose The Right One article today will go thoroughly through all information that you need to know about a distribution channel including its . explain the factors that influence choice of distribution channel. What are the factors that affect choice of channels? Since most clients require several different . Nature of the product. A supply chain concerns with all the aspects that begin with sourcing raw . Let me give certain points that you have to considered before selection of the channel 1. If the consumer expects credit facilities, desires to purchase all necessaries at one place one desire for the personal services of the salesman, the channel may be lengthier or shorter depends upon the capacity of providing those facilities and meeting out the needs of the customers. Answer to Explain how distribution patterns affect international marketing? Here, I'll discuss three major alternatives. 1 . Choice of appropriate channel of distribution is a very important marketing decision, which affects the performance of an organisation. The indirect . These customers wish to hold as little stock as possible without running out. 3. Therefore, channel of distribution is the means by which goods and services are made available to customers in the market. D. Management want to have greater control on the channel members. Factor # 6. Factors Determining the Choice of Distribution Channels • There are a number of factors-both objective and subjective varying from company to company which govern choice or selection of channel of distribution. 12. Market Factors: Important market factors affecting the choice of channel of distribution include size of market, geographical concentration of potential buyers and quantity purchased. A FMCG product will require different distribution than an automobile. Identifying major alternatives. Explain why some products are better suited to some distribution strategies than others. Complex products are often sold by specialist distributors or agents - Customised? also affect the choice between the channels. In such cases, a longer chain of distribution is profitable. Cited by 1 — The objectives of this study were: 1. Manager has to analyze company-related factors to decide the best fit channel(s). There are various constraints that are to be considered before deciding channel objectives. Explain five factors that may influence the choice of distribution channel for milk. Factors Determining the Choice of Distribution Channels • There are a number of factors-both objective and subjective varying from company to company which govern choice or selection of channel of distribution. If the product passes through a longer channel of distribution, the marketer will have to give more importance to advertising and less importance to personal selling. On the other hand, a low priced product with large number of buyers will . A number of factors influence this decision. ADVERTISEMENTS: Such factors may be classified as factors relating to: 1. Explain how distribution patterns affect internationalmarketing? Apart from the above factors, the environmental aspects such as econo­mies, social, and legal conditions have influence on the decision of a distribution channel. Channel Related Factors 5. The ideal situation for any retailer or manufacturer is to have just enough inventory on hand to sell or to keep production lines running smoothly. In case the . Important factors affecting the choice of channels of distribution by the manufacturer are:1) Product Related Factors: The choice of channels of distribution depends upon the factors related to the product. (i) Price of Product: ADVERTISEMENTS: A high priced product will have less middlemen because the number of buyers will be limited. Manufacturers may also feel short of customer-based skills for distribution of goods. Competitive Factors - The choice of channel is also affected by the channel selected by competitors in same industry. Important factors relating to the selection of a particular middleman are explained as under: (a) Cost of distribution of goods: Cost of distribution . Background: During the COVID-19 crisis, an apparent growth in vaccine hesitancy has been noticed due to different factors and reasons. Your chosen entrepreneur would have had to make the decision of either Direct or indirect, or possibly both. A . Answers. 4. Choice of appropriate channel of distribution is a very important marketing decision, which affects the performance of an organisation. 24/7 Study Help. (v) What is the required support system to satisfy the expectations of the channel members? However, many factors affect a firm's ability to choose the right supplier. Answer . B. Distribution channels are the methods by which companies deliver products and services to customers and end users. They are as follows: 1. 4 ساعت قبل . 6. Explain five ways in which commercial banks help in facilitating business activities in a country. C. Financial strength of the company. Customer Perspective . Describe the factors that affect a firm's channel decisions. Explain the factors that affect promotion mix or marketing communication mix. 14. Distribution channels and strategy looks more at creating demand for a product or service by leveraging on several strategies. communication media choice and the use of a web-based learning tool, as well as other types of communication media such as email, telephone and face-to-face, for communication and collaboration to complete given tasks. Adoption of newer channels. What are the factors that affect choice of channels? Factor # 3. Products can be perishable or nonperishable . Question. Three-Level Channel (Manufacturer to Agent to Wholesaler to Retailer to Customer): Three level channel of distribution involves an agent besides the wholesaler and retailer who assists in selling goods. Your distribution channel is the series of businesses, sellers, or other intermediaries your products must go through to reach your final consumers. To influence customers, organisations go for sales promotion like coupons, discounts on high quantity purchases, free samples, etc. Market considerations: The nature and type of customers is an important consideration in the choice of a channel of distribution. Learn about the factors influencing choice of distribution channel are:- 1. Customer and product characteristics tend to go hand in hand. There is a need to understanding of the supplier selection criteria. Explain at least five key factors that would influence their choice. Internal vs. external . Explain any five factors which affect the choice of channels of distribution. Explain five benefits that may accrue to the country from this extension. Environmental Factors. Factors that influence a choice of distribution channels. 15. Distribution channels and strategy looks more at creating demand for a product or service by leveraging on several strategies. A supply chain concerns with all the aspects that begin with sourcing raw . Answers. As against this, if the buyers are dispersed in a larger area then longer channels of distribution may be used. A company receives its distribution system in legacy . Products can be perishable or nonperishable . Unilever er Unilever when . Various other factors such as size of the market, geographical concentration of buyers, quantity demanded, etc. The intermediaries can be natural persons or businesses. The products of a lower price have a long chain of distributors. Any opinions, findings, conclusions or recommendations expressed in this material are those of the . A. Thus, quantity and quality of marketing services provided by the company can influence the channel choice directly. explain the factors that influence choice of distribution channel. Join / Login. explain the factors that influence choice of distribution channel. Hybrid Distribution System: A Company must manage a hybrid distribution system to avoid chaos and maximize efficiency, Responsibilities, relationships and compensations among various channel members must be made clear. These agents come handy when goods need to move quickly into the market soon after the order is placed. Highlight factors that may . If goods are sold through intermediaries then they decide the price and discount and promotional offers. Explain how intensive, exclusive, and selective distribution differ from one another. In case the number of buyers is small, like for most industrial products, short channels are used. All these factors greatly influence the choice of distribution channel. Handy when goods need to understanding of the study revealed that most firms communications in favor of social and... 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