Chapter 12 Flashcards
Distribution Channel
Institutions that transfer the ownership of goods and move goods from the point of production to the point of consumption
Supply Chain Management
Approaches and techniques firms employ to efficiently and effectively integrate their suppliers, manufacturers, warehouses, stores, and transportation intermediaries into a seamless value chain in which merchandise is produced and distributed in the right quantities, to the right locations and at the right time
Wholesalers
Firms engaged in buying, taking title to, storing, and physically handling goods in large quantities and then reselling goods to retailers
Retailers
Sell products directly to consumers
Logistics Management
Integration of 2 or more activities for the purpose of planning, implementing, controlling the efficient flow of raw materials, in-process inventory, and finished goods from the point of origin to the point of consumption
Distribution Centre
A facility for the receipt storage and redistribution of goods to company stores or customers
Channel Conflict
Results when supply chain members are not in agreement about their goals, roles or rewards
Vertical Marketing System
A supply chain in which the members act as a unified system
Types of Vertical Marketing Systems
- administrated
- contractual
- corporate
Administered Vertical Marketing System
No common ownership and no contractual relationship, but the dominant channel member controls the channel relationship
Contractual Vertical Marketing System
Independent firms at different levels of the supply chain join together through contracts to obtain economies of scale and coordination and to reduce conflict
Franchising
A contractual agreement between a franchisor and a franchisee that allows the franchisee to operate a retail outlet, using a name and roman developed and supported by the franchisor
Corporate Vertical Marketing System
The parent company has complete control and can dictate the priorities and objectives of the supply chain
Strategic Relationship (Partnering Relationship)
A supply chain relationship that the members are committed to maintaining long-term, investing in opportunities that are mutually beneficial. Required mutual trust, open communication, common goals, and credible commitments
Push Marketing Strategy
Designed to increase demand by focusing on wholesalers, distributors, or salespeople, who push the product to consumers via distribution channels
Pull Marketing Strategy
Designed to get consumers to pull the product into the supply chain by demanding that retailers carry it
Distribution Intensity
The number of channel members to use at each level of the supply chain
Intensive Distribution
A strategy designed to get products into as many outlets as possible
Exclusive Distribution
Strategy of granting exclusive rights to sell to one or very few retail customers so no other customers can sell a particular brand
Selective Distribution
Lies between the intensive and exclusive distribution strategies; uses a few selected customers in a territory
Universal Product Code (UPC)
Black and white bar code found on most merchandise
Electronic Data Interchange (EDI)
The computer-to-computer exchange of business documents from a retailer to a vendor and back
Advanced Shipping Notice
An electronic document that the supplier sends the retailer in advance of a shipment to tell the retailer exactly what to expect in the shipment
Vendor-managed inventory
An approach in which the manufacturer is responsible for replenishing inventory to meet retailer’s needs
Dispatcher
The person who coordinates deliveries to distribution centres
Radio Frequency Identification (RFID) Tags
Tiny computer chips that automatically transmit to a special scanner all information about a container’s contents or individual products
Just-in-time (JIT) Inventory Systems
Inventory management systems designed to deliver less merchandise on a more frequent basis than traditional inventory systems; the firm gets the merchandise “just in time” for it to be used in the manufacture of another product
Quick-response (QR)
Inventory management systems used in retailing; merchandise is received just in time for sale when the customer wants it
Lead time
Amount of time between the recognition that an order needs to be placed and the arrival of the needed merchandise at the seller’s store, ready for sale
