Question

Summarize each section in a paragraph in your own word

15.1 The variety of distribution channels and how they affect cost and efficiency in marketing
15.2 The Japanese distribution structure and what it means to Japanese customers and to competing importer of goods
15.3 How distribution patterns affect the various aspects of international marketing
15.4 The function, advantages, and disadvantages of various kinds of middleman
15.5 The importance of selecting and maintaining middlemen
15.6 The growing importance of e-commerce as a distribution alternatives

15.7 The interdependence f physical distribution activities.

Answer 1

• Types of Distribution channels:

Direct Channel or Zero Level Channels- Manufacturer directly sells to the consumer, instead of any intermediary, also called Zero Level Channels. Example- Retail outlets, internet selling. Highly cost effective and strongly effectively works in terms of online marketing or from direct company office/ production facility.

Indirect Channels- When a manufacturer needs an intermediary to move goods from the production place to the end user. Cost effective for international manufacturer selling via channel partners in different countries uses marketing competency advantage of the intermediaries. Chain further can stretch from 1 intermediary to more like Distributor/ whole seller/ Retailer to reach end customers

• Japanese business model is generally to assign local channel partners who share inventory/ investment/ risk of buying and selling/ marketing practices/ technical and commercial competencies etc., while they export their products to different countries. It is a part of their international growth strategy and marketing tactics. They export the product to these intermediaries, who further sell in their local market reach to various private and government customers.

Japanese always believe in high quality products whether they export or import. Hence, many of their products are premium priced.

• Distribution patterns in case of international marketing are very critical, since, they serve as a stretched part of a manufacturer or a producer in the local countries or regions. Distribution can stretch from 1 main Distributor/ authorized representative company to further Whole Sellers and Retailers in case of FMCG, FMCD kind of products, who utilise their marketing effectiveness and competencies to promote these international products to their local consumers, understanding consumer psychology and buying behaviour/ patterns etc. and share the feedback with main manufacturer. Local partners are heavily responsible to implement local ATL and BTL marketing strategies.
• Function of middlemen: share inventory handling and storage/ cash flow investment/ risk of buying and selling products/ marketing strategy and practices/ technical and commercial handling competencies etc.

Advantages: Cost saving, time saving, customer convenience, inventory stocking, reselling, financial support, technical support, after sales service

Disadvantages: loss of communication control, risk of loss of absolute hold in the local market, Revenue loss can happen, high risk of buying and selling, channel conflict