- 1. Logistics & Distribution Management Presentation on
Distribution Management SystemTeamNameRoll No. OrganizationPosition
HeldAnkit Upadhayay 04 Himani industries Ltd.Export
coordinatorHitesh Mhapankar64 Mukund Industries Ltd.Production
supervisorNikhil Patil17 Wadhwa GroupProcurement executiveRahul
Nadoskar47 Trans-Asia Biomedical.Commercial executiveShankar
Gawade21 Maersks India Pvt. Ltd. Customer support teamSwapnil
Juvetkar41 Mahanagar Gas ltd.Junior engineerRavi Lakhani50 General
Mills India P Ltd.Production planner11-Mar-131
2. Definition : The management ofthe efficient transfer of goods
fromthe place of manufacture to thepoint of sale or
consumption.Distribution managementencompasses such activities
aswarehousing, materials handling,packaging, stock control,
orderprocessing, and transportation. 11-Mar-13 2 3. 11-Mar-133 4.
Product A product is anything that can be offered to a market that
might satisfy a want or need in retailing. For e.g. refrigerator ,
T.V., Mobile phone etc.Place The place is where you can expect to
find your customer and knowing this place, you have to look for a
distribution channel in order to reach your customer.Price Price
sometimes refers to the quantity of payment requested by a seller
of goods or services, rather than the eventual payment
amount.Promotion Promotion is one of the market mix elements, and a
term used frequently in marketing. 11-Mar-134 5. The prime of
object of production is its consumption. The movement ofproduct
from producer to consumer is an important function of marketing.
Itis the obligation of the producer to make goods available at
right place, atright time right price and in right quantity. The
process of making goodsavailable to the consumer needs effective
channel of distribution. Therefore,the path taken by the goods in
its movement is termed as channel ofdistribution. The goods may be
sent to the consumer directly or indirectlythrough middlemen. The
channel of distribution may be classified as:A) Selling through
direct channelsB) Selling through indirect channels 11-Mar-135 6.
11-Mar-136 7. A) Selling through direct channelsThis is the oldest,
shorter and the simple channel of distribution. The producer sells
the productdirectly without involvement of any middle man. The sale
can be made door to door throughsalesman, retail stores and direct
mail. Certain industrial and consumer goods such as clothes,shoes,
books, hosiery goods, cosmetics, household appliances, electronic
goods etc., may be soldthrough direct contact. Perishable goods
such as vegetable and fruits can also be sold directly.Advantage of
selling through direct channelsIt is simple and fast.It is
economical.Disadvantages of selling through direct
channelsNon-availability of expert services of middle man.Large
investment is required. 11-Mar-13 7 8. B) Selling through indirect
channelAccording to this method of indirect selling, product is
passed on to the customers throughintermediaries, known as
wholesalers, retailers and agents. These channels may be as
under:1. Producers -> Wholesalers -> Retailers -> Customer
Two level Channel: It is commonly usedchannel of distribution. It
is also known as traditional or normal channel of distribution.
This channel isuseful for small producers for small means. The
channel is used for consumer goods. The commonpractice is that the
manufacturer sells goods in large quantity to wholesalers, who sell
goods to retailersin small quantity. Finally goods are sold to
customers in pieces.2. Producer -> Agent -> Retailer ->
Consumer or Two level Channel: The common practice in thistwo level
channel is that the goods are sold to the agent in bulk. The agent
sells goods to retailer, whosells goods to customers in pieces.
This channel is suitable where the retailers are few and
geographicallycentered. This channel is commonly used in textile,
machinery, equipment and agricultural products.11-Mar-138 9. 3.
Producer -> Agent -> Wholesaler -> Retailer -> Customer
or Three level Channel: Thecommon practice in this three level
channel is that goods are sold by the producer to the agent,who
sells it to the wholesaler, who sells to the retailers who finally
sells goods to customers.This is the longest channel of
distribution. This practice is useful, when the producer wants
tothe relieved of the problem of distribution. This channel is
popularly used in textile.4) Producer -> Retailer -> Customer
or one level Channel: Under this channel the producersells goods to
retailers, who sell the goods to customers. This channel is popular
with thedepartmental stores, chain stores and supermarkets etc.,
because these are large scale retailers.Generally readymade
garments, shoes home appliances and automobiles are sold through
thischannel.11-Mar-139 10. Patterns of Distribution decides the
intensity of the distribution & alsodecides the service level
provided.Types of Distribution intensities:1) Intensive2)
Selective3) Exclusive11-Mar-1310 11. Intensive Distribution : is
done through every reasonable outlet available FMCGStrategy is to
make sure that, the product is available in as many outlets as
possible.Preferred for Consumer, Pharmaceuticals & automobile
spare.Selective Distribution: Multiple but not all outlets in the
marketOnly a few selected outlets are allowed to keep the
productOutlets selected in line with the image of the company wants
to project.Preferred for High Value items like JewelersExclusive
Distribution: Highly selective choice of outlets, may be only one
in the wholemarket.Could include outlets set up by the company
itself (Bata)11-Mar-13 11 12. Channel format is basically decided
by who Drives the market1) Producer Driven2) Seller Driven3)
Service Driven4) Others 11-Mar-13 12 13. Producer Driven
format:This is the effort of the producer / manufacturer to reach
the product to hisconsumersExamples:Company owned retail outlets
(Bata, Petrol Pump)Licensed Outlets (MC
Donalds)FranchiseesBrokersVending MachinesCompany contracted
Distributors11-Mar-1313 14. Seller Driven:This is where producer /
manufacturer uses existing channels to reach largenumber of end
users.Examples:Existing wholesalers and RetailersModern Retail
formatsSpecialty shops (Shoppers stop)Discount stores (D Mart)Local
pheriwalas 11-Mar-1314 15. Service DrivenThese are the people who
facilitate the distributionExamples:Transport & Freight
forwardersWarehouse space providerC&F Agents3P Logistics
providerCouriers 11-Mar-13 15 16. Others includeMulti level
marketing systemsCooperative societiesTV Home shoppingCatalogue
marketingInternetExhibitions / fares / Trade showsDatabase
marketing11-Mar-1316 17. Multi channel Distribution:Used in
situation where there are same products but different market
segments,unrelated products in same markets, size of buyer varies
& reach is difficult.Company uses different channels to reach
same / different market segment.FMCGs have separate network for
retail markets & institutionsPharmacy companies may use
different channels to reach Doctors, Chemists
&Hospitals11-Mar-13 17 18. Thanks for your AttentionAny
question / Feedback11-Mar-1318