Chapter 15: Supply chain and channel management. After reading this chapter, you should be able to: Understand the importance of marketing channels and supply chain management, understand the difference between direct and indirect marketing channels, describe how marketing channels are managed, describe the flow of information and merchandise in the marketing channel.
chapter fifteen supply chain and channel management Copyright © 2015 McGrawHill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGrawHill Education LEARNING OBJECTIVES LO 15-1 Understand the importance of marketing channels and supply chain management LO 15-2 Understand the difference between direct and indirect marketing channels LO 15-3 Describe how marketing channels are managed LO 15-4 Describe the flow of information and merchandise in the marketing channel 152 Supply Chain Management 153 Marketing Channels Add Value ©Brand X Pictures/PunchStock FedEx commercial with John Moschitta 154 Designing Marketing Channels Direct Channel Direct Channel One Intermediary Direct Channel Two Intermediaries Manufacturer Manufacturer Manufacturer Wholesaler Customer Retailer Retailer Customer Customer 155 Managing the Marketing Channel and Supply Chain Horizontal Conflict Manufacturer Retailer Retailer Retailer 156 Managing the Marketing Channel and Supply Chain through Vertical Marketing Systems Independent or conventional supply chain Independent marketing channel Vertical marketing channel 157 Types of Vertical Marketing Systems 158 Power 159 Managing Marketing Channels and Supply Chains Through Strategic Relationships 1510 The Distribution Center Inbound Transportation • • Dispatcher coordinates deliveries Manufacturer may pay transportation expenses or retailers may negotiate directly with trucking companies and pay expenses Steve Cole/Photodisc/Getty Images 1519 The Distribution Center Receiving and Checking David Buffinton/Getty Images Photo by Scott Olson/Getty Images 1520 The Distribution Center Storing and CrossDocking Walter Hodges/Digital Vision/Getty Images 1521 The Distribution Center Getting Merchandise FloorReady Ticketing and marking Increasingly firms are forcing suppliers to ship floor ready merchandise 1522 The Distribution Center Shipping Merchandise to Stores • • Shipping merchandise to stores is complex for multi-store chains Distribution centers use sophisticated routing and scheduling systems Ryan McVay/Getty Images 1523 Courtesy Tubular Steel, Inc The Distribution Center Inventory Management Through JustInTime Systems Just-in-time (JIT) Quick response (QR) Zappos Website 1524 check yourself • • How does merchandise flow through a typical marketing channel? Why have just-in-time supply chain systems become so popular? 1525 Glossary Merchandise cartons that are cross-docked are prepackaged by the vendor for a specific store Return to slide 1526 Glossary Manufacturers can ship merchandise either directly to a store or to a distribution center, where it is then shipped to the store Return to slide 1527 Glossary Electronic data interchange (EDI) is the computer-to-computer exchange of business documents from a retailer to a vendor and back Return to slide 1528 Glossary Just-in-time inventory systems are inventory management systems designed to deliver less merchandise on a more frequent basis than traditional inventory systems Return to slide 1529 Glossary Radio frequency identification (RFID) tags are tiny computer chips that automatically transmit to a special scanner all the information about a container’s contents or individual products Return to slide 1530 Glossary A strategic relationship or partnering relationship involves the supply chain members being committed to maintaining the relationship over the long term and investing in opportunities that are mutually beneficial Return to slide 1531 Glossary Supply chain management is a set of approaches and techniques firms employ to integrate their suppliers, manufacturers, warehouses, stores, and transportation intermediaries into a seamless operation in which merchandise is produced and distributed in the right quantities, to the right locations, and at the right time, as well as to minimize system wide costs while satisfying the service levels that their customers require Return to slide 1532 Glossary Vendor-managed inventory (VMI) is an approach for improving supply chain efficiency in which the manufacturer is responsible for maintaining the retailer’s inventory levels in each of its stores Return to slide 1533 ... LO 1 5-1 Understand the importance of marketing channels and supply chain management LO 1 5-2 Understand the difference between direct and indirect marketing channels LO 1 5-3 Describe how marketing. .. how marketing channels are managed LO 1 5-4 Describe the flow of information and merchandise in the marketing channel 152 Supply Chain Management 153 Marketing Channels Add Value ©Brand X Pictures/PunchStock... conventional supply chain Independent marketing channel Vertical marketing channel 157 Types of Vertical Marketing Systems 158 Power 159 Managing Marketing Channels and Supply Chains Through Strategic Relationships