Slide 0 in Chapter 15

1
Chapter 15

• Managing Retailing, Wholesaling, and Market
  Logistics

PowerPoint by Karen E. James Louisiana State
University - Shreveport
2
Objectives

• Determine the types of organizations in this
  sector.
• Learn what marketing decisions organizations in
  this sector make.
• Understand the major trends in this sector.

3
Retailing

• Retailing Basics
• Types of retailers
• Marketing decisions
• Retailing trends

• Retail life cycle
• Wheel-of-retailing
• Service levels
• Retail positioning strategies
• Nonstore retailing
• Corporate retailing

4
Retailing
Major Store Retailer Types

• Specialty store
• Department store
• Supermarket

• Discount store
• Convenience store
• Off-price retailer

• Superstore

5
Retailing

• Retail-store types pass through the retail life
  cycle.
• The wheel-of-retailing describes how new store
  types emerge.
• Retailers can offer one of four levels of
  service
• Self-service, self-selection, limited service,
  and full service

6
Retailing

• Four broad retail positioning strategies include
• Bloomingdales
• Tiffany
• Sunglass Hut
• Wal-Mart
• Non-store retailing has been growing faster than
  store retailing

7
Retailing
Major Types of Retail Organizations

• Corporate chain store
• Voluntary chain
• Retailer cooperative

• Consumer cooperative
• Franchise organization
• Merchandising conglomerate

8
Retailing

• Retailing Basics
• Types of retailers
• Marketing decisions
• Retailing trends

• Target market
• Product assortment and placement
• Services mix and store atmosphere
• Price
• Promotion
• Place

9
Retailing
Location Options for Retailers

• General business district
• Regional shopping center
• Community shopping center

• Strip mall (shopping strip)
• Location within a larger store or operation

10
Retailing

• Retailing Basics
• Types of retailers
• Marketing decisions
• Retailing trends

• New retail forms
• Intertype competition
• Growth of giant retailers
• Technology
• Global expansion
• Selling experiences
• Competition between store-based and
  non-store-based retailing

11
Wholesaling

• Wholesaling
• Wholesaling basics
• Types of wholesalers
• Marketing decisions
• Wholesaling trends

• Wholesaling excludes manufacturers, farmers, and
  retailers
• Wholesalers differ from retailers in three key
  ways
• Wholesalers handle many functions more
  efficiently than do manufacturers

12
Wholesaling
Wholesaler Functions

• Selling and promoting
• Buying and assortment building
• Bulk breaking

• Warehousing
• Transportation
• Financing
• Risk bearing
• Market information

13
Wholesaling

• Wholesaling
• Wholesaling basics
• Growth and types of wholesalers
• Marketing decisions
• Wholesaling trends

• Wholesalers vary in type and function
• Wholesaling has been growing due to two key
  factors
• Many factories are located far from buyers
• An increasing need to adapt product quantities,
  features, or packages to meet buyer needs

14
Wholesaling
Major Wholesaler Types

• Merchant wholesalers
• Full-service wholesalers
• Limited-service wholesalers
• Brokers agents

• Brokers
• Agents
• Manufacturers and retailers branches and
  offices
• Miscellaneous wholesalers

15
Wholesaling

• Wholesaling
• Wholesaling basics
• Types of wholesalers
• Marketing decisions
• Wholesaling trends

• Target market
• Product assortment and placement
• Price
• Promotion
• Place

16
Wholesaling

• Wholesaling
• Wholesaling basics
• Types of wholesalers
• Marketing decisions
• Wholesaling trends

• Direct buying trends initially threatened
  wholesalers
• Wholesalers have adapted by
• Adding value
• Reducing costs
• Strengthening relationships with manufacturers

17
Market Logistics

• Interrelated Aspects Associated with Market
  Logistics
• Physical distribution
• Supply chain management (SCM)
• Value network
• Demand chain planning
• Market logistics
• Integrated logistics systems (ILS)

18
Market Logistics

• Key Elements
• Market-logistics objectives
• Market-logistics decisions
• Market logistics lessons

• Logistics involve trade-offs between costs and
  customer service
• Maximizing profits, not sales, is key
• A total system basis should be considered
• Designing a system that will minimize the cost of
  achieving objectives should be the outcome

19
Market Logistics
Calculating the Cost of Market-Logistics Systems

• M T FW VW S

• Where . . .
• M total market-logistics cost of proposed
  system
• T total freight cost of proposed system
• FW total fixed warehouse cost of proposed
  system
• VW total variable warehouse cost of proposed
  system
• S total cost of lost sales due to average
  delivery delay

20
Market Logistics

• Key Elements
• Market-logistics objectives
• Market-logistics decisions
• Market logistics lessons

• Order processing
• Warehousing
• Storage, distribution, automated warehouses
• Inventory
• Determine reorder point, relevant cost
  comparison, optimal order quantity
• Transportation
• Containerization
• Private vs. contract carriers

21
Market Logistics

• Key Elements
• Market-logistics objectives
• Market-logistics decisions
• Market logistics lessons

• A senior V.P. is needed as the single contact
  point for all logistical elements
• Senior V.P. must maintain close control
• Software and systems are essential for
  competitively superior logistics performance