Strategy - place/distribution - distribution channels transport, warehousing, industry, channel choice - selective, inclusive, exclusive - physical distribution

Question 1

Place

Answer 1

The fourth ‘P’ of the marketing mix is ‘place’ or distribution. Once a business manufactures a product, it must see that the product gets into the customers hands.

Question 2

Distribution channels

Answer 2

Channels of distribution are the routes taken to get the product from the business to the customer. This process usually involves a number of intermediaries, such as the wholesaler, broker, agent or retailers.

Producer to consumer

producer to retailer to consumer

producer to wholesaler to retailer to consumer

producer to agent to wholesaler to retailer to consumer

Some advantages of distribution channels include:
As more people use the internet for shopping, the traditional distribution channels, have been modified. Some retailers and wholesalers may be bypassed as customers deal directly with manufacturers. Electronic post and parcel delivery channels will be used more extensively to meet the increasing demand.

Ikea

Although IKEA products can only be purchased from IKEA stores and the IKEA website, their global reach of stores is continuing to expand:
There are 460 IKEA stores in 62 markets globally. The largest IKEA franchisee, the IKEA Group own: Australia (QLD, NSW, VIC), Austria, Belgium, Canada, China, Czech Republic, Denmark, Finland, France, Germany, Hungary, Italy, Japan, Netherlands, Norway, Poland, Portugal, Russia, Slovakia, Spain, Sweden, Switzerland, United Kingdom and USA.
Other stores are owned and run by other franchisees in 16 countries/territories. These are Australia (WA, SA), United Arab Emirates, Cyprus, Greece, Hong Kong, Iceland, Israel, Kuwait, Malaysia, the Netherlands, Romania, Saudi Arabia, Singapore, Spain, Taiwan, and Turkey.

Question 3

Market coverage

Answer 3

Market coverage refers to the number of outlets a firm chooses for its product. A business can decide to cover the market in one of three ways as follows, the difference being the intensity of coverage. NB: we will look at selective only.

Question 4

Channel choice selective distribution

Answer 4

Involves the use of a limited number of stores/locations to sell or distribute a product. This method allows business to control where products are sold and to ensure that the places chosen are consistent
with the image of the business.

e.g. Nike, apple, coach, prada

Question 5

Channel choice exclusive distribution

Answer 5

A form of distribution in which there is a restriction on the number of products and/or availability of the product. The product is available at a very limited number of venues. This allows the business to maintain control of all elements of the product.

e.g. McDonalds and Ikea

Question 6

Intensive distribution

Answer 6

Occurs when the product is readily available to a wide selection of stores or locations. The product is easily accessible by consumers and can be found at a number of different types of stores.

Question 7

Messina distribution

Answer 7

26 stores

Messina Hire (Gelato Cart & Van Hire)
Very expensive
Can hire a messina server as well

Icecream bars and cones Limited edition sometimes can’t buy all year
Not in every single woolworths

Messina on Wheels (Tell us where our ice cream van should go!) Stays for 30 minutes Only goes in city Can see if spot is popular and could open a store

Harris Farm Only sells in lane cove

Uber Eats
Buy larger tubs Takeaway options Half litre, litre, 1.5 litre Has to have store near you