Principles of Marketing

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Principles of Marketing
Lecture-29
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Summaryof Lecture-28
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(No Transcript)
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Manufacturer
Customer
Manufacturer
Customer
Manufacturer
Customer
Manufacturer
Customer
Manufacturer
20 Contacts
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Manufacturer
Customer
Manufacturer
Customer
Wholesaling Intermediary
Manufacturer
Customer
Manufacturer
Customer
Manufacturer
9 Contacts
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Marketing Channels for Consumer Goods
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Producer
Consumer
Producer
Retailer
Consumer
Producer
Wholesaler
Retailer
Consumer
Producer
Agent/ Broker
Wholesaler
Retailer
Consumer
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Marketing Channels for Business Goods
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Producer
Business User
Producer
Business User
Agent/ Broker
Producer
Wholesaler
Business User
Producer
Agent/ Broker
Wholesaler
Business User
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Channel Design Decisions
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Analyzing Consumer Service Needs
Setting Channel Objectives Constraints
Identifying Major Alternatives
Evaluating the Major Alternatives
Exclusive Distribution
Selective Distribution
Intensive Distribution
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Channel Management Decisions
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Selecting
Motivating
FEEDBACK
Evaluating
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Todays Topics
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Logistic Management
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Push Versus Pull Strategy
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Producer
End users
Interme- diaries
Marketing activities
Demand
Demand
Push Strategy
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Marketing activities
End users
Interme- diaries
Producer
Demand
Demand
Pull Strategy
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Producer
End users
Interme- diaries
Marketing activities
Demand
Demand
Push Strategy
Marketing activities
End users
Interme- diaries
Producer
Demand
Demand
Pull Strategy
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Marketing Logistics and Supply Chain Management
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• Companies must decide on the best way to store,
  handle, and move their products and services from
  points of origin to points of consumption.

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Marketing Logistics (physical distribution)
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• The tasks involved managing the physical flow of
  materials, final goods, and related information
  from points of origin to points of consumption to
  meet customer requirements at a profit.

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Supply Chain Management
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• Managing upstream and downstream value-added
  flows of materials, final goods, and related
  information among suppliers, the company,
  reseller, and final consumers

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• Marketing Logistics and Supply Chain Management

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• Involves getting the right product to the right
  customers in the right place at the right time.
• Marketing logistics addresses
• Outbound distribution,
• Inbound distribution,
• Reverse distribution,
• Entire supply chain management.

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Supply Chain Management
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Nature and Importance of Marketing Logistics
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• Involves getting the right product to the right
  customers in the right place at the right time.

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• Companies today place greater emphasis on
  logistics because..

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• Effective logistics is becoming a key to winning
  and keeping customers.
• Logistics is a major cost element for most
  companies.

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• The explosion in product variety has created a
  need for improved logistics management.
• Information technology has created opportunities
  for major gains in distribution efficiency.

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Functions of Logistics Systems
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Costs Minimize Costs of Attaining
Logistics Objectives
Order Processing Submitted Processed Shipped
Warehousing Storage Distribution
Logistics Functions
Transportation Water, Truck, Rail,
Pipeline Air
Inventory When to order How much to
order Just-in-time
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Costs
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Order Processing
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Order Processing System
System whereby orders are entered into the supply
chain and filled. The order brings the supply
chain in motion.
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• Order processing involves several stages
• - first, the order is transmitted by a variety
  of means such as the Internet, an Extranet, or
  EDI
• - next, the order is entered into the
  appropriate databases
• - then the information is sent to those who need
  it.

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Electronic Data Interchange
Information technology that replaces paper
documents that accompany business transactions.
EDI
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Warehousing
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• Involves the physical storage or stock-keeping of
  raw materials, product components, and/or
  finished goods.
• Three basic functions
• Movement
• Storage
• Information transfer

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Warehouse and Materials-Handling
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Inventory

• When to order?
• How much to order?
• Just-in-Time

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Inventory Control System
A method of developing and maintaining an
adequate assortment of materials or products to
meet a manufacturers or a customers demand.
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Just-in-Time (JIT) Concept
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• JIT is an inventory supply system that operates
  with very low inventories and requires fast,
  on-time delivery.
• When parts are needed for production, they
  arrive from supplier just in time, which means
  neither before or after they are needed.
• JIT is used in situations where demand
  forecasting is reliable. It is NOT appropriate
  for inventories that are to be stored over a
  significant period of time.

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Transportation
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Transportation Modes
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Rail
Truck Flexible in routing time schedules,
efficient for short-hauls of high value goods
Water Low cost for shipping bulky, low-value
goods, slowest form
Pipeline Ship petroleum, natural gas, and
chemicals from sources to markets
Air High cost, ideal when speed is needed or to
ship high-value, low-bulk items
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Checklist for Choosing Transportation Modes
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1. Speed.
2. Dependability.
3. Capability.
4. Availability.
5. Cost.
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Customer Service Concept
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• Customer service is the ability of logistics
  management to satisfy users in terms of
• - time
• - dependability
• - communication
• - convenience

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Right Place
Right Cost
Right Product
Right Time
Right Condition
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Enough for today. . .
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Summary
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Producer
End users
Interme- diaries
Marketing activities
Demand
Demand
Push Strategy
Marketing activities
End users
Interme- diaries
Producer
Demand
Demand
Pull Strategy
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Marketing Logistics and Supply Chain Management
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Functions of Logistics Systems
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Costs Minimize Costs of Attaining
Logistics Objectives
Order Processing Submitted Processed Shipped
Warehousing Storage Distribution
Logistics Functions
Transportation Water, Truck, Rail,
Pipeline Air
Inventory When to order How much to
order Just-in-time
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Next.
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Retailing and Wholesaling
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Principles of Marketing
Lecture-29