Chapter 15

Wholesalers

Firm engaged in buying, taking title to, often storing, and physically handling goods in large quantities, then reselling the goods (usually in smaller quantities) to retailers or industrial or business users

Supply chain management

set of approaches and techniques firms employ to efficiently and effectively integrate their suppliers, manufacturers, warehouses, stores, and transportation intermediaries into a seamless operation in which merchandise is produced and distributed in the right quantities, to the right locations, and at the right time as well as to minimize systemwide costs while satisfying the service levels their customers require

Just-In-Time inventory system

inventory management system designed to deliver less merchandise on a more frequent basis than traditional inventory systems

Quick response inventory system

merchandise is received just in time for sale when the customer wants it

Distribution center

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

Fulfillment centers

used to ship directly to individual customers

Direct marketing channel

manufacturer to customer

Indirect channel w one intermediary

manufacturer to retailer to customer

Indirect channel with two intermediaries

manufacturer to wholesaler to retailer and customer

Franchising

contractual agreement between a franchisor and a franchisee that allows the franchisee to operate a business using a name and format developed and supported by the franchisor.

Vertical conflict

manufacturer to retailer one; members of the same marketing channel, for example, manufacturers, wholesalers, and retailers, are in disagreement or discord

Horizontal conflict

retailers 1, 2, & 3; members at the same level of a marketing channel, for example, two competing retailers or two competing manufacturers, are in disagreement or discord, such as when they are in a price war

Powers in the marketing channel

reward, coercive, referent, expertise, information, & legitimate

Power

one member has the means or ability to have control over the actions of another member in a channel at a different level of distribution

Referent power

one channel member wants to be associated with another channel member.

Strategic relationships

mutual trust, open communication, common goals, interdependence, & credible commitments

Information flow

UPC

universal product code; manufacturer of the item, a description of the item, information about special packaging, and special promotions

Merchandise flow