Channel Roles/Benefits/Obligations

Question 1

Disseminate Marketing Communications and Promote Brands

Answer 1

ensures wholesalers, retailers, and consumers are aware of a product and its value proposition

• push strategy -> focuses on convincing wholesalers, distributors, or retailers to stock more inventory
• pull strategy ->focuses on creating consumer demand so retailers, wholesalers, and distributors feel compelled to stock more of the product
• collaborative promotions (manufacturers and retailers collaborating for promotional campaigns, ex. coupons, prints/e-flyers)

Question 2

Sorting and Regrouping Products

Answer 2

Breaking bulk quantities into smaller units for businesses or retailers with limited demand or storage

Function:
- wholesalers and distributors handle the division of large quantities
- provide an assortment of brands/products to meet retailer or business needs

Question 3

Storing and Managing Inventory

Answer 3

ensuring the availability of products to avoid lost sales

Activities:
- maintain reserve inventory to meet consumer demand
- store raw materials like grains until processing is required

Cost Considerations:
- warehousing expenses, storage space, utilities, and staff for stocking and shipping
example -> Walmart’s suppliers manage their inventory based on real-time store data

Question 4

Distributing Products

Answer 4

physical movement of goods within the channel, ensuring timely and secure delivery

Transportation:
- large channel partners (Walmart) may own fleets of trucks
- Others hire third-party transport providers (trucking companies, railroads)

Tracking:
- essential to monitor merchandise location and condition
- prevents losses due to damage, delays, or spoilage
- improves competitiveness by ensuring timely product availability

Question 5

Assume Ownership Risk and Extend Credit

Answer 5

Ownership and Risk are determined by contracts and “free on board” (FOB) provisions

FOB specifies:
- who bears shipping costs
- when ownership transfers between channel members

Strategies:
- Many firms try to minimize inventory during uncertain periods to avoid losses from unsold goods

Example: products damaged in transit, risk often shared based on prior contractual agreements

Question 6

Share Marketing and Other Information

Answer 6

sharing insights on demand trends, inventory levels, and competitor activities benefits all channel partners

Benefits:
- improved forecasting
- enhanced coordination in the supply chain
- better responses to competitive pressures

Confidentiality:
channel partners often sign nondisclosure agreements (NDAs) to ensure proprietary information (sales data, inventory numbers) is protected

Ethical Concerns:
sales representatives cannot share sensitive data (comparing sales between competitors like Loblaws and Sobeys)