Place (Distribution Channels and Supply Chain Management Flashcards

1
Q

Making goods and services available in the right quantities and locations when consumers want them

A

Place

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2
Q

Supplier Network consists of

A

consists of processes and activities necessary to turn raw materials into a good or service

Sub component manufacturers, component manufacturers, and assembly plant

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3
Q

Supplier network is upstream/downstream

A

upstream

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4
Q

Channels of distribution consist of

A

firms or individuals who participate in the flow of products from the manufacturer to the final customer

Assembly plants, distribution channels: wholesalers and retailers, and consumers

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5
Q

Distribution channels are upstream/downstream

A

downstream

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6
Q

Logistics service providers move stuff from

A
Subcomponent manufacturers (100s)
Component Manufacturers (dozens)
Assembly Plant (handful)
Distribution Channels: wholesalers and retailers (100s, 1000s, respectively)
Consumers (millions)
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7
Q

Direct channel

A

manufacturer sells directly to consumer through the internet or in company-owned stores

Manufacturer to customer

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8
Q

Indirect channel

A

one or more intermediaries work with manufacturer to deliver goods to consumers

manufacturer to retailer to customer
OR
manufacturer to wholesaler to retailer to customer

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9
Q

wholesalers

A

firms that buy products from different manufacturers and then sell them to multiple retailers (B2B)

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10
Q

retailers

A

firms that buy products from manufacturers or other intermediaries to sell to consumers (B2C)

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11
Q

Retail Distribution Center

A

large retailers set up central warehouse locations
instead of shipping directly to each retail location, a manufacturer can make one shipment to the retail distribution center, which sends the supplies to the retailers as needed

facility for the receipt, storage, and redistribution of goods to company stores or consumers
may be operated by retailers, manufacturers, or distribution specialists

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12
Q

Market Channel is valuable because

A
  • Reduces transaction costs like paperwork, transportation and fulfillment, packaging
  • Creates efficiencies such as breaking bulk and creating assortments
  • Customer relations
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13
Q

breaking bulk

A

manufacturer ships in large quantities and wholesaler breaks up into smaller quantities

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14
Q

creating assortments

A

one intermediary can sell multiple manufacturers’ products in one location

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15
Q

customer relations

A

assist in buying decisions, offer repair services, educate, and offer credit or financing

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16
Q

vertical conflict

A

when channel members are not in agreement over goals, roles, or rewards

between manufacturers and retailers

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17
Q

horizontal conflict

A

disagreements between channel members of equal levels (like Home Depot and Lowe’s engaging in a price war)

between retailers

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18
Q

The internet caused _____ which initially caused a radical distribution strategy change, as well as increased ____ between supply chain members

A

disintermediation

knowledge management-sharing knowledge

19
Q

Disintermediation

A

eliminating traditional intermediaries, works well with digital/information goods

music industry, travel, brokerages

20
Q

independent (conventional) channel system

A

each intermediary operates independently with their own profit and sales objectives, even at the expense of a channel partner

21
Q

vertical marketing systems

A

independent intermediaries act in a unified manner, sharing information and other strategic needs

22
Q

administered vertical system

A

the more powerful partner dominates and controls the relationship

Manufacturers like Walmart vs. small mom & pop operations

23
Q

contractual vertical system

A

contracts determine the extent and management of the relationship, coordinate and reduce conflict

Target/Walmart with a larger manufacturer
Franchising

24
Q

corporate vertical system

A

parent company has complete control because it owns multiple segments of the channel, manufacturing, warehousing, retail

American Apparel, Apple

25
Franchise
contractual agreement between franchisee and franchisor that allows franchisee to operate a retail outlet using a name and format developed by the franchisor
26
Franchisees typically:
pay a lump sum and royalty on sales to operate comply with rules that the franchisor sets receive some assistance from franchisor
27
manufacturer-sponsored retailer franchise
Ford and its independent franchised dealers
28
manufacturer-sponsored wholesaler franchise
Coca-Cola's licensed bottlers
29
service-firm sponsored retailer franchise
McDonalds, Avis, Holiday Inn
30
intensive distribution
selling through all suitable wholesalers and retailers, many intermediaries
31
selective distribution
using fewer outlets in a specific territory but more than exclusive Apple
32
exclusive distribution
selling only through a single outlet in a region selected retailers
33
Power exists when
one channel member has the means or ability to dictate actions of another member
34
reward power
rewards for doing what the dominant company wants
35
coercive power
punish for behavior
36
referent power
need association | supplier desperately wants to be associated with dominant company
37
expertise power
knowledge, how-to, product or marketing specialty
38
information power
use of consumer info providing or withholding consumer and market info
39
legitimate power
contractual obligation occurs in an administered vertical marketing system
40
Strategic relationships require
mutual trust, open communication, common goals, interdependence, credible commitments
41
supply chain management
management of flows among the firms in a supply chain to maximize total profitability includes physical movement of and sharing of information about goods how firms integrate their suppliers, manufacturers, warehouses, stores, and transportation intermediaries into a seamless operation of merchandise production and distribution
42
channel players
manufacturer -> wholesaler -> retailer -> customer
43
outsourcing vs. insourcing
contracting with a specialist that brings in an external company to run essential operations (services the company's supply chains)
44
Conflict affects
affects pricing, incentives, price wars, presentation, and more