Retail Management - Supply Chain

Flashcards covering key vocabulary and concepts related to supply chain management, retailer-supplier relations, and category management.

Supply Chain

Set of institutions that move goods from production to consumption, incorporating materials and disposal processes.

Channel

Term used for the supply chain.

External Forces Affecting the Supply Chain

Consumer behavior, competitor behavior, socioeconomic environment, technological environment, legal and ethical environment.

Marketing Functions of the Supply Chain

Buying, selling, storing, transporting, sorting, financing, information gathering, risk taking.

Sorting

Breaking down heterogeneous products into homogenous groups.

Logistics Network

Entities involved in moving physical inventory from source to retail store.

Logistics Inventory

Moving physical inventory from the source to the retail store.

Total Business Cost

All direct and indirect costs of manufacturing, distributing, and marketing a product.

Primary Marketing Institutions

Channel members that take title to the goods.

Facilitating Marketing Institutions

Channel members that do not take title but assist in the marketing process.

Public Warehouse

Stores goods for safekeeping for any owner in return for a fee.

Third-Party Logistics Provider

Provides outsourced logistics services for storage, transporting, sorting, information, and risk management.

Direct Supply Chain

Manufacturer sells goods directly to the final consumer.

Intensive Distribution

All possible retailers are used in a trade area.

Selective Distribution

Moderate number of retailers are used in a trade area.

Exclusive Distribution

Only one retailer is used to cover a trading area.

Conventional Marketing Channel

Loosely aligned channel members with a short-term orientation.

Vertical Marketing Channels

Capital-intensive, professionally managed networks for long-term relationships.

Quick Response (QR) / Efficient Consumer Response (ECR) Systems

Integrated systems for real-time information on consumer actions and efficient scheduling.

Corporate Vertical Marketing Channels

One institution owns multiple levels of distribution.

Contractual Vertical Marketing Channels

Contract governs the working relationship between channel members.

Retailer-Owned Cooperatives

Wholesale institutions owned by member retailers.

Franchise

Form of licensing where a business owner obtains distribution through affiliated dealers.

Administered Vertical Marketing Channels

Channel members lead by applying effective interorganizational management.

Dependency

Each channel member depends on others to perform a job.

Power

Ability of one channel member to influence the decisions of others.

Reward Power

Ability to provide rewards.

Expertise Power

Based on special knowledge.

Referent Power

Based on identification with another member.

Coercive Power

Ability to punish or harm.

Legitimate Power

Right to influence based on position.

Conflict

Major sources include perceptual incongruity, goal incompatibility, and domain disagreements.

Perceptual Incongruity

Retailer and supplier have different perceptions of reality.

Goal Incompatibility

Achieving the goals of one hampers the performance of the other.

Dual Distribution

Manufacturer sells to independent retailers and through its own outlets.

Domain Disagreements

Disagreement about which member should make decisions.

Diverter

Unauthorized member buying and selling excess merchandise.

Gray Marketing

Branded merchandise flows through unauthorized channels.

Free-riding

Seeking information from a full-service store but purchasing from a discounter.

Mutual Trust

Faith that each member will be truthful and fair.

Two-way Communication

Open exchange of ideas, concerns, and plans.

Solidarity

High value placed on the relationship, leading to flexible dealings.

Category Management (CM)

Process of managing all SKUs within a product category.

Category Manager

Creates store displays based on local conditions, trends, and point-of-sale information.