Business Plan – Q4: Distribution in Asia
Week 1 – Training: Distribution
Functions:
Distribution
Production > Whole sale > Retailing
Distribution?: how to get products (incl. services) from factories to customers
Two − Logistics (transport and − Strategic (contribution to
approaches: storage) marketing objectives)
Decisions: 2. Distribution intensity 3. Type of retailers
involved
1. Length of the 4. Single or multiple 5. Primary communication
distribution channel channel strategy target group
1. Length of the distribution channel:
Production
V
V
V
V
V
Wholesale
V
V
V
V
Retail
V
v
Consumers
Decision length of the channel: added value vs. costs involved
2. Distribution intensity:
− Intensive − Selective distribution − Exclusive distribution
distribution (few intermediaries) (very few
(outlets) intermediaries)
Intensive distribution provides convenience and availability to consumers;
increase brand preference and loyalty of customers
Decision distribution intensity:
− Type of product (linked with − Desired − Desired control over
consumer behaviour) dealer push distribution channel
3. Type of retail: traditional (marketplace) vs. modern retail (convenience
stores, supermarkets, hypermarkets
− Type of product − Wheel of retailing
Decision type of retail: − Desired − Division of power in the
positioning channel
4. Single or multiple channel: (e.g. retail vs. e-commerce)
− Possible dissatisfied − No uniform − Possible decrease in
distributors profile distribution coverage
Business Plan – Q4: Distribution in Asia 1
, 5. Primary communication target group:
< < < <
Producer Producer
V V
V V V ^
V V
Push process: Wholesaler Pull process: Wholesaler
V V
“Taking the “Getting the
V V V ^
product to the customer to
V V
customer.” Retailer come to you.” Retailer
> > V
V V ^
V
Consumer Consumer
> >
Who is the target?: Ethics:
− Consumers? − Competitions
Use of sales promotion:
− Store personnel? − Gifts
− Cross product offers
Coupons: Sweepstakes: Price offers:
− Literacy − Legal aspects − Price labelling
− Social status − Local market − Bargaining/trade
Possible taste misuse
adequacy Savings: Free samples: Gifts:
problems: − Orientation on − Vision on − Legal
future gratuity − Ethical level
− Level on − Ethical level
inflation
− Consumers − Capital − Coverage
Checklist for
− Culture − Cost − Continuity
distribution:
− Character − Competition − Control
The “cultural filter”:
Role of − Return of − Time − Degree of − Who?
shopping goods? spent? loyalty?
Opening − Religion? − Femininity?
hours
Product − Religion? − Law?
range
Sales system − Personnel? − Self
service?
Character − Service − Waiting? − Ethics?
attitude?
Relationship between channel members:
Level of links between members of Hofstede’s cultural dimensions:
domestic channels:
− Competition on product level? − UA: Strong partners
− Competition on outlet level? − I: Use of objective criteria
− DOB? − M: Negotiations on objective
criteria
− PD: Way of negotiating
2 Business Plan – Q4: Distribution in Asia
Week 1 – Training: Distribution
Functions:
Distribution
Production > Whole sale > Retailing
Distribution?: how to get products (incl. services) from factories to customers
Two − Logistics (transport and − Strategic (contribution to
approaches: storage) marketing objectives)
Decisions: 2. Distribution intensity 3. Type of retailers
involved
1. Length of the 4. Single or multiple 5. Primary communication
distribution channel channel strategy target group
1. Length of the distribution channel:
Production
V
V
V
V
V
Wholesale
V
V
V
V
Retail
V
v
Consumers
Decision length of the channel: added value vs. costs involved
2. Distribution intensity:
− Intensive − Selective distribution − Exclusive distribution
distribution (few intermediaries) (very few
(outlets) intermediaries)
Intensive distribution provides convenience and availability to consumers;
increase brand preference and loyalty of customers
Decision distribution intensity:
− Type of product (linked with − Desired − Desired control over
consumer behaviour) dealer push distribution channel
3. Type of retail: traditional (marketplace) vs. modern retail (convenience
stores, supermarkets, hypermarkets
− Type of product − Wheel of retailing
Decision type of retail: − Desired − Division of power in the
positioning channel
4. Single or multiple channel: (e.g. retail vs. e-commerce)
− Possible dissatisfied − No uniform − Possible decrease in
distributors profile distribution coverage
Business Plan – Q4: Distribution in Asia 1
, 5. Primary communication target group:
< < < <
Producer Producer
V V
V V V ^
V V
Push process: Wholesaler Pull process: Wholesaler
V V
“Taking the “Getting the
V V V ^
product to the customer to
V V
customer.” Retailer come to you.” Retailer
> > V
V V ^
V
Consumer Consumer
> >
Who is the target?: Ethics:
− Consumers? − Competitions
Use of sales promotion:
− Store personnel? − Gifts
− Cross product offers
Coupons: Sweepstakes: Price offers:
− Literacy − Legal aspects − Price labelling
− Social status − Local market − Bargaining/trade
Possible taste misuse
adequacy Savings: Free samples: Gifts:
problems: − Orientation on − Vision on − Legal
future gratuity − Ethical level
− Level on − Ethical level
inflation
− Consumers − Capital − Coverage
Checklist for
− Culture − Cost − Continuity
distribution:
− Character − Competition − Control
The “cultural filter”:
Role of − Return of − Time − Degree of − Who?
shopping goods? spent? loyalty?
Opening − Religion? − Femininity?
hours
Product − Religion? − Law?
range
Sales system − Personnel? − Self
service?
Character − Service − Waiting? − Ethics?
attitude?
Relationship between channel members:
Level of links between members of Hofstede’s cultural dimensions:
domestic channels:
− Competition on product level? − UA: Strong partners
− Competition on outlet level? − I: Use of objective criteria
− DOB? − M: Negotiations on objective
criteria
− PD: Way of negotiating
2 Business Plan – Q4: Distribution in Asia
