ch 12 Final Review

Conventional distribution systems
Conventional distribution systems consist of one or more independent channel members.
•Often results in poor performance
Vertical marketing systems (VMSs)
consists of producers, wholesalers, and retailers acting as a unified system and consist of:
consists of producers, wholesalers, and retailers acting as a unified system and consist of:
•Corporate marketing systems
•Contractual marketing systems
•Administered marketing systems
Corporate vertical marketing system-
Controls production and distribution under single ownership.
•Kroger
•Gallo
Contractual vertical marketing system:
Independent firms who join together through contracts
*The most common form is franchise organization
3 types
1. Manufacturer-sponsored retailer franchise system
– Ford dealer and Do It Best Hardware
2. Manufacturer-sponsored wholesaler franchise system
– Coke and Budweiser
3. Service firm-sponsored retailer franchise system
-Mcdonalds and Burger King
1. Manufacturer-sponsored retailer franchise system
Contractual vertical marketing system
– Ford dealer and Do It Best Hardware
2. Manufacturer-sponsored wholesaler franchise system
Contractual vertical marketing system
– Coke and Budweiser
3. Service firm-sponsored retailer franchise system
Contractual vertical marketing system
-Mcdonalds and Burger King
Administered vertical marketing system:
A few dominant channel members. Leadership comes from size and power
•Wal-Mart
•Kraft
Horizontal marketing systems:
two or more companies join together for a new marketing opportunity.
-banks in grocery stores
-Mcdonalds in gas stations in china
Changing Channel Organization
Disintermediation
– producers cut out intermediaries and go directly to final buyers.
(dell, Nook, and netflix)
Cross-Docking
•a practice that involves unloading products from suppliers, sorting products, and quickly reloading products onto its trucks.
•The package never hits the floor.