Ch 14 Quality

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International Marketing Channel
Chapter
14
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General Distribution Patterns
? Middlemen Services ? Line Breadth ? Costs and
Margins ? Channel Length ? Nonexistent
Channels ? Blocked Channels ? Stocking ?
Power and Competition
14-7
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Retail Patterns
Retail Outlets Population Employees Country (000)
per Outlet per Outlet
Argentina 199.5 164 4 Australia 160.2 111 5 Canada
157.2 183 9 India 3540.0 253 NA Japan 1591.2 79 4
Malaysia 170.6 109 8 Mexico 899.3 96 2 Philippine
s 120.1 547 28 South Africa 60.4 675 7 South
Korea 730.0 60 2 U.S.A
1516.3 170
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14-9
SOURCES International Marketing Data and
Statistics, 21st ed.
(London Euromonitor
Publications, 1997), and "Indicators of Market
Size for
115 Countries," Crossborder Monitor, August 27,
1997.
Irwin/McGraw-Hill
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Cutting Out the Middleman
Number of companies involved in each level of the
food industry, of total, 1993
141,597
97,882
181,374
Total number
100
Manufacturers
90
14-8
80
Wholesalers
70
60
50
40
Retailers
30
20
10
0
Japan
Britain
United States
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International Channel-of-Distribution Alternatives
Home Country
Foreign Country
The foreign marketer or producer sells to or
through
Foreign consumer
Domestic producer or marketer sells to or through
14-10
Foreign agent or merchant wholesalers
Open distribution via domestic wholesale middlemen
Foreign retailers
Exporter
Importer
Export management company or company sales force
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Home Country Middlemen
? Global Retailers Sears, Wal-mart, Toys R
Us, etc. ? Export Management Company (EMC) -
low-cost independent marketing dept. that serves
as the export dept. for the a company ? Trading
Companies (Foreign) accumulate, transport and
distribute goods from many countries, for
example, Japan ? Complementary Marketers
piggybacking, ex GE, Avon/Mattel ?
Manufacturer's Export Agents similar to EMC
but operate on their own, in few markets, and is
a short-term relationship ? Home Country Brokers
bring buyers and sellers together
14-11
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Home Country Middlemen
? Buying Offices look for and purchase
merchandise based on client needs ? Export
Merchants domestic merchants operating in
foreign markets, much like a domestic
wholesaler ? Export Jobbers arrange
transportation
14-12
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Foreign Country Middlemen
? Manufacturer's Representatives deal as field
sales representatives for the manufacturer ?
Distributors merchant middleman, usually with
exclusive sales rights for specific territories ?
Brokers ? Wholesalers ? Retailers
14-17
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Factors Affecting Channel Choices

• Cost
• capital cost of developing channel
• cost to maintain channel
• ? Capital
• ? Control
• ? Coverage
• Character
• self-service, scrambled merchandising,
  discounting trends
• ? Continuity

14-14
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Channel Development
? Locating Middlemen ? Selecting Middlemen ?
Screening ? Agreements ? Motivating
Middlemen ? Terminating Middlemen ? Controlling
Middlemen
14-15
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E-Vendors Issues of Concern

• culture
• Translation
• Local Contact
• Payment
• Delivery
• Promotion

14-17