MANAGING RETAILING, WHOLESALING, AND LOGISTIC

Disusun Oleh:Syilvta Nastassia Syahputri (122121120)

Chapter Objective:

What major types of marketing intermediaries occupy this sector?What marketing decisions do these marketing intermediaries make?What are major trends with marketing intermediaries?

Types of Retailers

Service levelsWheel-of retailingRetail life cycle

Corporate retailing

Non-store retailing

Retail positioning strategies

RETAILING

Retail-store types pass through the retail life cycle.Four broad retail positioning strategies include:• Bloomingdale’s• Tiffany• Sunglass Hut• Wal-Mart

The wheel-of-retailing describes how new store types emerge.

Non-store retailing has been growing faster than store retailing.

Retailers can offer one of four levels of service; Self-service, self-selection, limited service, and full serviceThese organizations achieve economies of scale, greater purchasing power, wider brand recognation & better trained employees than independent stores can usually gain alone.

RETAILINGRetailing includes all the activities in selling goods or service directly to final consumers for personal, non-business use.

Major Retailer Types:Specialty store

Narrow product line. Example;

Department storeSeveral product line. Example;

SupermarketLarge, low-cost, low-margin, high volume, self service store designed to meet total needs for food and household products. Example;

RETAILINGConvenience store

Small store in residential area, often open 24/7, limited line of high-turnover convenience products plus takeout.

Example;

Discount storeStandard or specialty merchandise; low-price, low-margin,

high-volume stores. Example;

Off-price retailerLeftover goods, overruns, irregular merchandise sold at less than retail. Example;

RETAILINGSuperstore

Huge selling space, routinely purchased food and household items, plus services. Category killer (deep assortment in one category), example; combination store, example;

hypermarket (huge stores that combine supermarket, discount, and warehouse retailing), example;

Catalog ShowroomBroad selection of high-markup, fast moving, brand-name

goods sold by catalog at discount. Customer pick up merchandise at the store. Example;

Bloomingdale’s Wal-Mart

Tiffany Sunglass HutBre

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RETAILING

Broad

Narrow

Value Added

Retail Positioning MapSource: William T. Gregor and Eileen M. Friars, Money Merchandising: Retail Revolution in Consumer Financial Service (Cambridge, MA: The MAC Group, 1982).

RETAILINGLevels of Retail Service

Self-serviceSelf service is the cornerstone of all discount operations.

Self-selectionCustomers find their own goods, although they can ask

for assistance.

Limited serviceThese retailers carry more shopping goods & services

such as credit & merchandise-return privileges.Full service

Sales people are ready to assist in every phase of the locate-compare-select process.

RETAILINGNon-store Retailing

Direct sellingIs a multibillion-dollar

industry, with hundreds of companies selling door to

door or at home salesparties.

Direct marketingHas roots in direct-mail & catalog

marketing; it includestelemarketing, television direct-

response marketing,& electronic shopping.

Automatic vendingOffers a variety of merchandise,including impulse goods such assoft drinks, coffee & newspapers

Buying serviceIs a store less retailer serving a specificClientele, usually employees of largeOrganizations, who are entitled to buyFrom a list of retailers that have agreed

To give discounts in return for membership

Characteristics of FranchisesThe franchisor owns a trade or service mark and licenses it to franchisees in return for royalty payments.The franchisee pays for the right to be part of the system.The franchisor provides its franchisees with a system for doing business.

RETAILING

Retailer’s Marketing Decisions• Target market

Until it defines & profiles the target market, the retailer cannot make consistent decisions about product assortment, store decor, advertising messages & media, price and service levels.

• Product assortment and placementThe retailer’s product assortment must match the target market’s shopping expectations. The retailer must decide on product-

assortment breadth and depth.• Procurement

After deciding on the product-assortment strategy, the retailer must establish merchandise sources, policies and practices.

RETAILING

• Services mix and store atmosphereThe service mix is a key tool for differentiating one store from

another. retailers must decide on the service mix to offer customers. Pre-purchase services include accepting telephone & mail orders, Post-purchase service include shipping & delivery, Ancillary services include general information, check cashing & parking. Atmosphere is another element in the store arsenal. Every store has a look and a physical layout that makes it hard or easy to move around.• Price

Price is the key positioning factor & must be decided in relation to the target market, the product-and-service assortment mix, and the

competition. Retailers must also pay attention to pricing tactics. Most retailers will put low prices on some items to serve as traffic builders or loss leaders or to signal their pricing policies.• Store activities and experiences

Victoria’s Secret, retailer of lingerie, other women’s clothing, and beauty products, works on the concept of “retail theater”: customers feel they are in a romance novel, with lush music & faint floral scents in the

background.

RETAILING

• Communications Retailers use a wide range of communication tools to generate traffic and

purchases.• Location Decision

The three keys to retail success are “location, location, location”. Retails can place their stores in the following locations:

1. Central business districts. Downtown.2. Regional shopping centers. Large suburban malls containing 40

to 200 stores, typically featuring one or two nationally known anchor stores & a great number of smaller stores, many under franchise operation.

3. Community shopping centers. Smaller malls with one anchor store and between 20 and 40 smaller stores.

4. Shopping strips. A cluster of stores, usually housed in one long building, serving a neighborhood’s needs for groceries, hardware, laundry, shoe repair & dry cleaning.5. A location within a large store. Certain well-known retailers

locate new, smaller units as concession space within larger stores such as airports.

RETAILING

Wholesaling excludes manufacturers, farmers, and retailers.Wholesalers differ from retailers in three key ways.Wholesalers handle many functions more efficiently than do manufacturers.

WHOLESALING

Wholesaling Basics

WHOLESALING

Wholesaling Functions

Selling and promoting Buying and assortment

building Bulk breaking Warehousing

Transportation Financing Risk bearing Market information Management services and

counseling

WHOLESALINGMajor Wholesaler Types

Merchant. Independently owned businesses that take title to the merchandise they handle.

Full-service. Carry stock, maintain a sales force, offer credit, make deliveries, provide management assistance.

Limited-service. Cash & carry wholesalers sell a limited line of fast-moving goods to small retailers for cash.

Brokers & agents. Facilitate buying & selling, on commission of 2% to 6% of the selling price; limited functions; specialize by product line.

Manufacturers. Wholesaling operations conducted by sellers or buyers themselves rather than through independent wholesalers.

Specialized. Agricultural assemblers, petroleum bulk plants&terminals, auction companies.

WHOLESALING

Wholesaling Trends

Direct buying trends initially threatened wholesalers.

Wholesalers have adapted by:Adding valueReducing costsStrengthening relationships with manufacturers

Deciding on the company’s value proposition to its customers.Deciding on the best channel design and network strategy.Developing operational excellence.Implementing the solution.

WHOLESALING

Market Logistics Planning

WHOLESALINGMarket Logistics• Sales forecasting• Distribution scheduling• Production plans• Finished-goods inventory

decisions• Packaging

• In-plant warehousing• Shipping-room processing• Outbound transportation• Field warehousing• Customer delivery and

servicing

WHOLESALINGMarket-Logistics Decisions

• How should orders be handled?• Where should stock be located?• How much stock should be held?• How should goods be shipped?

• Order processing• Warehousing

Storage, distribution, automated warehouses.

• InventoryDetermine reorder point, relevant cost comparison, optimal order quantity.

• TransportationContainerization & private vs. contract carriers.

WHOLESALING

Calculating the Cost of Market-Logistics Systems

M = T + FW + VW + S

Where . . . M = total market-logistics cost of proposed system; T = total freight cost of proposed system;FW = total fixed warehouse cost of proposed system;VW = total variable warehouse cost of proposed system S = total cost of lost sales due to average delivery delay

WHOLESALINGFigure 16.2 Determining Optimal Order Quantity

SpeedFrequencyDependabilityCapabilityAvailabilityTraceabilityCost

WHOLESALING

Transportation Factors

SpeedFrequencyDependabilityCapabilityAvailabilityTraceabilityCost

CONCLUSION

Transportation Factors

TERIMA KASIH