Principles of Marketing - Distribution Channels and Supply Chain Management

Vocabulary flashcards generated from the SLHT Principles of Marketing notes covering distribution channel structures, channel flows, functions, supply chain management processes, and logistical components.

Distribution Channel

Sets of interdependent organizations involved in the process of making a product or service available for use or consumption, as well as providing a payment mechanism for the provider.

Product Flow

The movement of the physical product from the manufacturer through all the parties who take physical possession of the product until it reaches the ultimate consumer.

Negotiation Flow

The marketing channel flow that encompasses the institutions associated with the actual exchange processes.

Ownership Flow

The flow that shows the movement of title through the distribution channel.

Information Flow

The marketing channel flow that identifies the individuals who participate in the flow of information either up or down the channel.

Promotion Flow

The flow of persuasive communication in the form of advertising, personal selling, sales promotion, and public relations across channel members.

Business-to-Business (B2B) Distribution

Distribution occurring between a producer and industrial users of raw materials needed for the manufacture of finished products.

Business-to-Customer (B2C) Distribution

Distribution that occurs directly between the producer and the final user.

Producer → Consumer Channel

A direct channel where the producer sells goods or provides services directly to the consumer without intermediaries.

Producer → Retailer → Consumer Channel

A marketing channel where retailers purchase goods from producers and sell them to consumers; works best for shopping goods like clothes, shoes, furniture, tableware, and toys.

Producer → Wholesaler/Distributor → Consumer Channel

A channel where wholesalers purchase products in bulk from manufacturers and sell them directly or indirectly to consumers, reducing unit prices by eliminating extra retail service costs.

Producer → Agent/Broker → Wholesaler or Retailer → Consumer Channel

A channel involving an agent or broker intermediary to assist with negotiation; commonly used when perishable goods must reach the market quickly before rotting.

Agent / Broker

A middleman who assists with negotiation between the manufacturer and seller and receives a commission from the producer.

Supply Chain

Consists of the various firms included in executing the activities needed to produce and transport a product or service to consumers or industrial users.

Supply Chain Management (SCM)

The supervision of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer.

Shared Efficiency

An SCM approach where channel members collaborate and share inventory data to ensure speedy replenishment and minimize inventory costs.

Customer Relationship Management (CRM)

An SCM business process that allows companies to prioritize their marketing focus on different customer groups based on each group's long-term value.

Customer Service Management

An SCM process featuring a unified system of responding to customers' complaints, concerns, questions, or comments.

Demand Management

An SCM process that aligns supply and demand throughout the supply chain by foreseeing customer requirements and creating an action plan prior to actual purchasing.

Order-fulfillment

An SCM process that engages in generating, filling, delivering, and providing on-the-spot service for customer orders to reduce time between order and receipt.

Manufacturing Flow Management

An SCM process ensuring firms in the supply chain have necessary resources to produce with flexibility and move products in a multi-stage production process.

Supplier Relationship Management

An SCM process providing structural support for developing and maintaining good relationships with highly valued suppliers.

Product Development and Commercialization

An SCM process facilitating the joint development and marketing of new products and services among supply chain partner firms.

Returns Management

An SCM business process enabling firms to manage volumes of returned products efficiently while minimizing costs.

Logistics

The strategic managing of the efficient flow and storage of raw materials, in-process inventory, and finished goods from point of origin to point of consumption.

Push Manufacturing

A manufacturing environment where goods are scheduled and produced based on past sales and demand forecasts before being sent to retailers.

Pull Manufacturing

A manufacturing environment where production of goods or services is not scheduled until there is an order placed by the customer specifying the desired design.

Cost (Transportation)

The total amount charged by a carrier to move a product from the point of origin to its destination.

Transit Time

The total time required for a carrier to pick up, deliver, handle, and move goods from point of origin to destination.

Reliability (Transportation)

The consistency of a carrier in delivering goods on time and in satisfactory condition.

Capability (Transportation)

The ability of a carrier to provide applicable equipment and conditions for moving specific goods, such as refrigerated environments.

Accessibility (Transportation)

The ability of a carrier to transport goods over a particular route or network.

Traceability

The relative ease with which a shipment of goods can be located and transferred.