Using the book Pride, William M.; Ferrell, O. C.. Foundations of Marketing (Page

Question

Using the book

Pride, William M.; Ferrell, O. C.. Foundations of Marketing (Page 392). South-Western College/West. Kindle Edition.

1. Define supply-chain management. Why is it important?
2. Describe the major functions of marketing channels.
Why are these functions better accomplished through the
combined efforts of channel members?
4. Compare and contrast the four major types of marketing
channels for consumer products. Through which type of
channel is each of the following products most likely to
be distributed?
a. New automobiles
b. Saltine crackers
c. Cut-your-own Christmas trees
d. New textbooks
e. Sofas
f. Soft drinks

8. Identify and describe the factors that may influence
marketing channel selection decisions.

Explanation / Answer

Supply chain management refers to the consolidated network of non-production business processes that comprise the value chain right from the procurement of raw material upto delivery of finished product to the customer. It includes processes sucha s sourcing, procurement, inbound logistics, storage, production planning, inventory management, warehousing, picking, packing, dispatch, outbound logistics, reverse logistics, repairs and warranty claims.

Suply chain management is a very important operation aspect of business today. Globalisation and rising competition creates tremendous pressure to reduce cost, bring operational efficiency, and deliver exceptional customer service. Service has becvome an important dimension of the product, apart from high quality product, customers also require timely and satisfactory service. Service aspect of the delivery is taken care of by supply chain management. This critical importance of supply chain management to the business has resulted in evolution of supply chain management as a specialised discipline. The wide scope of processes included in the SCM mean greater scope for operational efficiency and waste reduction and hence the greater importance of SCM.

The major function of marketin channels is to make products available at right place, right time, at the right price and in right quantities. Producers and consumers are connected through mutliple layers of intermediaries such as Carrying and forwarding agents, super stockists, distributors, wholesalers, resellers, retailers and corporate customers.

These functions of marketing are accomplished by the combined effort of the channel members. Channel members create the convenience of time, place, quantity and possession utility. For example distributor makes the product available at all the demand locations. Inventory kept by the distributor at its warehouses makes sure that the product is available in sufficient quantity to meet the demand forecast. Channel members also provide the limited facility of flexible payment terms, as well they provide access to product use by means of outright sale or rental. Thus channel members facilitate exchange efficiencies, which result in reduction of the cost of exchange.

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