CH 15 - Distributing Products Flashcards

Comprehensive vocabulary definitions covering marketing intermediaries, distribution strategies, utilities, and logistics management based on Chapter 15 lecture notes.

Marketing intermediaries (middlemen)

Organizations that assist in moving goods & services from producers to businesses (B2B) & from businesses to consumers (B2C).

Channel of Distribution

The whole set of marketing intermediaries, such as agents, brokers, wholesalers, & retailers, that join together to transport & store goods in their path from producers to consumers.

Agents and brokers

Marketing intermediaries who bring buyers & sellers together & assist in negotiating an exchange but do not take title to the goods.

Wholesaler

A marketing intermediary that sells to other organizations, such as retailers, manufacturers, & hospitals, as part of a B2B system.

Retailer

An organization that sells to ultimate consumers, or individual people.

Utility

In economics, the want-satisfying ability, or value, that organizations add to goods or services when the products are made more useful or accessible to consumers.

Form Utility

Value traditionally provided by producers rather than intermediaries by changing raw materials into useful products.

Time Utility

Adding value to products by making them available when they are needed, such as via 24-hour grocery stores.

Place Utility

Adding value to products by having them where people want them, such as adding pickup and delivery services to grocery stores.

Possession Utility

Doing whatever is necessary to transfer ownership from one party to another, including providing credit, delivery, installation, guarantees, & follow-up service.

Information Utility

Adding value to products by opening two-way flows of information between marketing participants through websites, salespeople, or publications.

Service Utility

Providing fast, friendly service during and after the sale and teaching customers how to best use products over time.

Retail sale

The sale of goods & services to consumers for their personal use.

Wholesale sale

The sale of goods & services to businesses & institutions for use in the business, or to wholesalers or retailers for resale.

Merchant Wholesalers

Independently owned firms that take title to the goods they handle, making up approximately $80\%$ of wholesalers.

Full-service wholesalers

Wholesalers that perform all distribution functions, such as maintaining inventory, providing a sales force, and assuming risk for the goods.

Rack jobbers

Wholesalers that furnish racks or shelves full of merchandise to retailers, display products, and sell on consignment.

Cash-and-carry wholesalers

Wholesalers that serve mostly smaller retailers with a limited assortment of products where retailers traditionally pay cash and carry goods back.

Drop Shippers

Wholesalers that solicit orders from retailers and other wholesalers and have the merchandise shipped directly from a producer to a buyer.

Manufacturer's agent

An agent who may represent several manufacturers in a specific territory, as long as they do not carry competing products.

Sales agent

An agent who represents a single producer in a typically large territory.

Intensive distribution

A retail distribution strategy that puts products into as many retail outlets as possible, typically used for convenience goods like soft drinks.

Selective distribution

A distribution strategy that sends products to only a preferred group of retailers in an area, used for shopping goods like appliances.

Exclusive distribution

A distribution strategy that sends products to only one retail outlet in a given geographic area, often seen with luxury auto manufacturers.

Social commerce

A form of electronic commerce that involves using social media & user contributions to assist in the online buying and selling of products and services.

Direct selling

Reaching consumers in their homes or workplaces, often using house parties or sponsoring events at workplaces to sell items like cosmetics.

Direct marketing

Any activity that directly links manufacturers or intermediaries with the ultimate consumer, including online marketing, direct mail, and telemarketing.

Corporate Distribution system

A distribution system in which all of the organizations in the channel of distribution are owned by one firm.

Contractual Distribution Systems

A distribution system in which members are bound to cooperate through contractual agreements, such as franchises, wholesaler-sponsored chains, or retail cooperatives.

Administered Distribution system

A distribution system in which producers manage all of the marketing functions at the retail level without a formal contractual agreement.

Supply Chain (value chain)

The sequence of linked activities performed by various organizations to move goods from the sources of raw materials to ultimate consumers.

Logistics

The planning, implementing, & controlling of the physical flow of materials, final goods, & related info from points of origin to points of consumption.

Inbound logistics

The area of logistics that brings raw materials, packaging, other goods & services, & info from suppliers to producers.

Materials handling

The movement of goods within a warehouse, from warehouses to the factory floor, and from the factory floor to various workstations.

Outbound logistics

The area of logistics that involves managing the flow of finished products & info to business buyers & ultimate consumers.

Reverse logistics

The area of logistics that brings goods back to the manufacturer because of defects or for recycling materials.

Third-party logistics (3PLs)

The use of outside firms to help move goods and share business intelligence knowledge proactively.

Freight forwarder

An organization that puts many small shipments together to create a single large shipment that can be transported cost-effectively.

Intermodal shipping

The use of multiple modes of transportation—such as highway, air, water, and rail—to complete a single long-distance movement of freight.

Trailer on flat car (TOFC) / Piggybacking

A shipping method where truck trailers are detached from the cab, loaded onto a railroad flatcar, and taken to a destination.

Fishyback

A shipping method where truck trailers are placed on ships to travel long distances at lower rates.

Storage warehouse

A facility used to hold products, especially seasonal goods, for a relatively long time.

Distribution warehouses

Facilities used to gather & redistribute products rather than store them long-term.