Ch.15 Retailing, Direct Marketing, Wholesaling

physical distribution objectives

- meeting customer service standards - reduce total distribution costs - reduce cycle time (the time needed to complete a process)

intermodal transportation

2+ transportation modes used in combination

public warehouse

a business that leases storage space and related physical distribution facilities to other firms

private warehouse

a company-operated facility for storing and shipping products

electronic data interchange (EDI)

a computerized means of integrating order processing with production, inventory, accounting, and transportation

television home shopping

a form of selling in which products are presented to television viewers, who can buy them by calling a toll0free number and paying with a credit card

specialty-line wholesaler

a full-service wholesaler that carries only a single product line or a few items within a line

general-line wholesaler

a full-service wholesaler which offers extensive assortments within a few product lines

general-merchandise wholesaler

a full-service wholesaler with a wide, but shallow product mix

superstore

a giant retail outlet that carries food and nonfood products found in supermarkets, as well as most routinely purchased consumer products (Wal-Mart Supercenters, Super Kmart Centers)

wheel of retailing

a hypothesis holding that new retailers usually enter the market as low-status, low-margin, low-price operators but eventually evolve into high-cost, high-price merchants

department store

a large retail organization characterized by a wide product mix and organized into separate departments to facilitate marketing efforts and internal management (Macy's)

distribution center

a large, centralized warehouse that focuses on moving rather than storing goods

supermarket

a large, self-service store that carries a complete line of food products, along with some nonfood products

warehouse club

a large-scale, members-only establishment that combines features of cash-and-carry wholesaling with discount retailing (Costco, Sam's Club)

drop shipper

a limited-service wholesaler that takes title to goods and negotiates sales but never actually takes possession of products

cash-and-carry wholesaler

a limited-service wholesaler whose customers pay cash and furnish transportation

sales branches

a manufacturer-owned intermediary that sells products and provides support services to the manufacturer's sales force

sales office

a manufacturer-owned operation that provides services normally associated with agents

full-service wholesaler

a merchant wholesaler that performs the widest range of wholesaling functions

limited-service wholesaler

a merchant wholesaler that provides some services and specializes in a few functions

general-merchandise retailer

a retail establishment that offers a variety of product lines that are stocked in considerable depth

warehouse showroom

a retail facility in a large, low-cost building with large on-premise inventories and minimal services (IKEA)

category management

a retail strategy of managing groups of similar, often substitutable products produced by different manufacturers

discount store

a self-service, general-merchandise store offering brand name and private products at low prices (Wal-Mart, Target)

neighborhood shopping center

a shopping center usually consisting of several small convenience and specialty stores

community shopping center

a shopping center with one or two department stores, some specialty stores, and convenience stores

convenience store

a small self-service store that is open long hours and carries a narrow assortment of products, usually convenience items

off-price retailer

a store that buys manufacturers' seconds, overruns, returns, and off-season merchandise for resale to consumers at deep discounts (Ross, Marshalls)

traditional specialty retailer

a store that carries a narrow product mix with deep product lines (Foot Locker, Radio Shack)

hypermarket

a store that combines supermarket and discount store shopping in one location (Wal-Mart hypermarkets and alike popular in other countries)

direct-response marketing

a type of marketing in which a retailers advertises a product and makes it available through mail or telephone orders

catalog marketing

a type of marketing in which an organization provides a catalog from which customers make selections and place orders by mail, telephone, or the internet

outlet shopping center

a type of shopping center that features discount and factory outlet stores carrying manufacturer brands

power shopping center

a type of shopping center that features off-price and small stores combined with category killers

lifestyle shopping center

a type of shopping center that is typically open-air and features upscale specialty, dining, and entertainment stores

regional shopping center

a type of shopping center with large department stores, the wide product mix, and the deep product lines of all shopping centers

superregional shopping center

a type of shopping center with the largest department stores, the widest product mix, and the deepest product lines of all shopping centers

rack jobber

a type of specialty-line wholesaler that owns and maintains display racks in stores

category killer

a very large specialty store that concentrates on a major product category and competes on the basis of low prices and enormous product availability (Home Depot, Barnes & Noble)

catalog showroom

a warehouse showroom in which consumers use catalogs to place orders for products, which are then filled directly in the warehouse area and picked up by buyers in the showroom

mail-order wholesaler

a wholesaler who uses catalogs instead of a sales force to sell products to retail and business buyers

physical distribution

activities used to move products from producers to consumers and other end users

retailing

all transactions in which the buyer intends to consume the product through personal, family, or household use

commission merchant

an agent that receives goods on consignment from local sellers and negotiates sales in large, central markets

franchising

an arrangement in which a supplier (franchiser) grants a dealer (franchisee) the right to sell products in exchange for some type of consideration

manufacturers' agent

an independent intermediary that represents 2+ sellers and usually offers customers complete product lines

merchant wholesaler

an independently owned business that takes title to goods, assumes ownership risks, and buys and resells products to other wholesalers, business customers, or retailers

wholesaler

an individual or organization that sells products that are bought for resales, for making other products, or for general business operations

broker

an intermediary that brings buyers and sellers together temporarily

selling agent

an intermediary that markets a whole product line or a manufacturer's entire output

agent

an intermediary that represents either buyers or sellers on a permanent basis

just-in-time (JIT)

an inventory management approach in which supplies arrive just when needed for production or resale

freight forwarder

an organization that consolidates shipments from several firms into efficient lot sizes

retailer

an organization that purchases products for the purpose of reselling them to ultimate consumers

outsourcing

contracting physical distribution tasks to third parties that do not have managerial authority within the marketing channel

inventory management

developing and maintaining adequate assortments of products to meet customers' needs

retail positioning

identifying an unserved or underserved market segment and serving it through a strategy that distinguishes the retailer from others in the minds of consumers in that segment

truck wholesaler

limited-service wholesaler that transports products directly to customers for inspection and selection

Types of Agents (3)

manufacturers' agent selling agent commission merchant

direct selling

marketing products to ultimate consumers through face-to-face sales presentations at home or in the workplace

materials handling

physical handling of tangible goods, supplies, and resources

online retailing

retailing that makes products available to buyers through computer connections

scrambled merchandising

the addition of unrelated product lines to an existing product mix, particularly fast-moving items that can be sold in volume

warehousing

the design and operation of facilities for storing and moving goods

transportation

the movement of products from where they are made to where they are used

telemarketing

the performance of marketing-related activities by telephone

atmospherics

the physical elements in a store's design that appeal to consumers' emotions and encourage buying

order processing

the receipt and transmission of sales order information (when efficient, contributes to physical distribution objectives)

nonstore retailing

the selling of products outside the confines of a retail facility

automatic vending

the use of machines to dispense products

direct marketing

the use of the telephone, internet, and nonpersonal media to introduce products to customers, who can then purchase them via mail, telephone, or the internet

wholesaling

transactions in which products are bought for resales, for making other products, or for general business operations