Chapter 15: Distributing products

______________ are organizations that assist in moving goods and services from producers to businesses (B2B) and from businesses to consumers (B2C).

Marketing intermediaries or middlemen

A _______________________ consists of a whole set of marketing intermediaries, such as agents, brokers, wholesalers, and retailers, that join together to transport and store goods in their path (or channel) from producers to consumers.

channel of distribution

_______________ are marketing intermediaries who bring buyers and sellers together and assist in negotiating an exchange but they never own the goods

Agents/brokers

A ______________ is a marketing intermediary that sells to other organizations, such as retailers, manufacturers, and hospitals.

wholesaler

Wholesalers are part of the:

B2B system

a ____________ is an organization that sells to ultimate consumers (people like you and me).

retailer

Manufacturers use intermediaries instead of selling directly to consumers because …..

intermediaries can perform certain marketing tasks faster and cheaper

Adding a wholesaler to the channel of distribution is beneficial because …..

it cuts the number of contacts, improving distribution efficiency

Marketers say that intermediaries add ……

value that outweighs the cost

____________, in economics, is the want-satisfying ability, or value, that organizations add to goods or services by making them more useful or accessible to consumers than they were before.

Utility

Traditionally, producers rather than intermediaries have provided this kind of utility

form utility

This type of utility is when raw materials are changed into useful products

Form utility

Intermediaries, such as retailers, add this kind of utility to products

time utility

This kind of utility is added to products by making them available when consumers need them.

time utility

Intermediaries add place utility to products by ………..

placing them where people want them

Intermediaries add possession utility by doing whatever is necessary to………

transfer ownership from one party to another

Intermediaries add information utility by

opening two-way flows of information between marketing participants

Intermediaries add service utility by providing …………

fast, friendly service during and after the sale

A retail sale is the sale of goods and services for

personal use

A wholesale sale is the sale of goods and services for …..

use in a business or for resale

Wholesalers make ___________ sales

business to business

____________ are independently owned firms that take title to the goods they handle.

Merchant wholesalers

These wholesalers perform all the distribution functions

Full-service wholesalers

These types of wholesalers perform select functions but try to do them especially well.

Limited-function wholesalers

___________________ (a type of limited-function wholesaler) furnish racks or shelves full of merchandise to retailers

Rack jobbers

____________ (a type of limited-function wholesaler) display the products and sell them on consignment, meaning they keep title to the goods until they’re sold and then share the profits with the retailer.

Rack jobbers

This type of limited wholesaler serves mostly smaller retailers with a limited assortment of products.

Cash-and-carry wholesalers

__________ (a type of limited-function wholesaler) solicit orders from retailers and other wholesalers and have the merchandise shipped directly from a producer to a buyer.

Drop shippers

Agents and brokers bring buyers and sellers together and assist in negotiating an exchange. However, unlike merchant wholesalers, agents and brokers …..

never own the product

____________________ Usually do not carry inventory, provide credit, or assume risks

Agents and brokers

merchant wholesalers earn a profit from …..

the sale of goods

agents and brokers earn ….

commissions or fees based on their sales

__________ often maintain long-term relationships with the people they represent, whereas __________ are usually hired on a temporary basis.

Agents

brokers

Agents who represent producers are either

manufacturers’ agents or sales agents

A retailer sells to …..

the ultimate consumer

This category of retail distribution puts products into as many retail outlets as possible.

Intensive distribution

Products that need intensive distribution are …

convenience goods

This category of retail distribution uses only a preferred group of the available retailers in an area

Selective distribution

This category of retail distribution uses only one retail outlet in a given geographic area.

Exclusive distribution

________________ consists of selling goods and services to ultimate consumers online

Online retailing

__________________ is a form of electronic commerce that involves using social media and user contributions to assist in the online buying and selling of products and service

Social commerce

____________ is the sale of goods and services by telephone.

Telemarketing

Vending machines dispense ___________ goods when consumers deposit sufficient money or swipe their card and have the benefit of _______

convenience

location

___________ are temporary outlets that remain open for a short amount of time in small spaces and offer items not found in traditional stores.

Pop-up stores

this form of selling reaches consumers in their homes or workplaces.

Direct selling

______________ are people recruited by the people you recruit

downliners

The main attraction of multilevel marketing for employees, other than the potential for making money, is ……..

the low cost of entry

_________________ includes any activity that directly links manufacturers or intermediaries with the ultimate consumer.

Direct marketing

One way traditional retailers can compete with online retailers is

to be very efficient so the online retailers cannot beat them on cost

In a ____________________________ , one firm owns all the organizations in the channel of distribution.

corporate distribution system

In a __________________________, members are bound to cooperate through contractual agreements.

contractual distribution system

Franchise systems, Wholesalers-sponsored chains, and retail cooperatives are all examples of ………

types of contractual systems

In this form of contractual system, Each store signs an agreement to use the same name, participate in chain promotions, and cooperate as a unified system of stores, even though each is independently owned and managed

Wholesaler-sponsored chains

This form of contractual system, is much like a wholesaler-sponsored chain except it is initiated by the retailers. The same degree of cooperation exists, and the stores remain independent.

Retail cooperatives