Lecture Marketing channel strategy: Chapter 7 - TS. Đinh Tiến Minh

Learning objectives: Distinguish between three broad categories of institutions that constitute the wholesaling sector, define how an independent wholesaler-distributor adds value and explain why this sector is growing, detail the mechanisms by which channel members join federations or alliances that offer exceptional services while cutting costs.... and other contents.
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Lecture Marketing channel strategy: Chapter 7 - TS. Đinh Tiến Minh3/5/2018Chapter 7: Wholesaling Structuresand StrategiesDINH Tien MinhLEARNING OBJECTIVES Distinguish between three broad categories of institutions thatconstitute the wholesaling sector. Define how an independent wholesaler-distributor adds value andexplain why this sector is growing. Detail the mechanisms by which channel members joinfederations or alliances that offer exceptional services whilecutting costs. Identify the major distinctions between a wholesaler voluntarygroup and a dealer cooperative, and relate this distinction to thevalue they provide members. Describe how wholesaling is being altered by electroniccommerce. Compare sales agents with wholesaler-distributors in the ways thatmatter to a manufacturer.WHOLESALING STRUCTURES Wholesaling (wholesale trade, wholesale distribution) refersto business establishments sell products primarily to otherbusinesses: retailers, merchants, contractors, industrial users,institutional users, and commercial users. Wholesale businesses sell physical inputs and products to otherbusinesses.13/5/2018Wholesaler-Distributors Wholesaler-distributors are independently owned andoperated firms that buy and sell products over which theyclaim ownership.Master DistributorsMultiple ManufacturesMaster DistributorWholesalers1,250(4,000 branches)Electrical ContractorsOther Supply Chain Participants Agents, brokers, and commission agents buy or sellproducts and earn commissions or fees, without ever takingownership of the products they represent.23/5/2018WHOLESALING STRATEGIES An Historical Perspective on Wholesaling Strategy Doing the job correctly (no errors). Doing the job effectively (maximum service). Doing the job efficiently (low costs). Wholesaling Value-Added Strategies Wholesalers add value by creating an efficient infrastructure toexploit economies of scope and scale. Wholesalers provide time and place utility Wholesalers transform the goods they sell Wholesaling Strategies in Foreign Markets Wholesaling Strategies in Emerging Economies Alliance-Based Wholesaling Strategies WHOLESALER-LED INITIATIVES MANUFACTURER-LED INITIATIVES RETAILER-SPONSORED COOPERATIVES33/5/2018 Consolidation Strategies in Wholesaling First, they can attempt to predict which wholesalers will be leftstanding and build partnerships with them. Second, manufacturers facing wholesale consolidation caninvest in fragmentation. Third, a manufacturer facing wholesale consolidation can builda different, alternative route to market by verticallyintegrating forward. Fourth, a manufacturer might increase its ownattractiveness to the remaining channels, usually byincreasing its own ability to offer benefits (e.g., a strong brandname).ADAPTING TO TRENDS INWHOLESALING International Expansion Electronic Commerce B2B Online Exchanges Online Reverse Auctions Fee for Services Vertical Integration of Manufactures into WholesalingTHE END!www.dinhtienminh.net4