3. Importance of Channels of Marketing Producers Consumers Without intermediaries 16 transactions
4. Importance of Channels of Marketing Producers Consumers With intermediaries 8 transactions Intermediaries Supermarket Channels reduce number of transactions
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9. Alternative Channels of Distribution Retailer Channel Wholesaler Channel Agent/Broker Channel Direct Channel Indirect Channels Producer Producer Producer Producer Consumers or User Retailers or Distributor Retailers or Distributor Retailers or Distributor Wholesalers Wholesalers Agents or Brokers Consumers or User Consumers or User Consumers or User
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11. Functions of Marketing Channels Selling & Promoting Matching Buyers and Sellers Bulk-Breaking Warehousing Transportation Financing Risk Bearing Market Information Management Services & Advice
4 Classic picture of the value of intermediaries: If four of you want to go to the store and make pizza and need dough, canned tomatoes, cheese, and anchovies. . .
5 Works even better with 16 consumers, etc. bc geometric. Same model applies to 16 pharmaceutical firms and 16 drugstore: Wholesalers make the “pick” (assortment) and break bulk. When you hear: “We cut out the middleman,” don’t think it’s necessarily a good idea. Most intermediaries add value Consider shopping for T-shirts and jeans without The Gap. = Soviet Union under communism.