Design of channels
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This document discusses how to design effective distribution channels. It recommends analyzing customer needs and establishing channel objectives and constraints. Major alternatives should be identified and evaluated based on criteria like economic factors, control, and adaptability. Customers choose channels based on price, selection, convenience, and shopping goals. Effective channels produce the right service levels and costs to meet customer preferences.
Design of channels
- 1. How should channels be designed?
- 2. Functions to perform while designing Analyze customer needs and wants Establish channel objectives and constraints Identify and evaluate major channel alternatives
- 3. Consumers opt for a channel on basis of: • Price • Product assortment • Convenience • Their own shopping goals Analyzing customer needs and wants
- 4. • Lot size • Waiting and delivery time • Spatial convenience • Product variety • Service backup Service outputs that a channel produces
- 5. On their basis, consumer opts a particular channel
- 6. In terms of: • Service output levels • Associated cost and support levels Establishing Objectives
- 7. Bulky products require ease in handling and minimum shipping distance High-value or complex products require company’s sales force
- 8. • Depression in economic conditions- shorter channels are required • Legal regulations and restrictions Constraints
- 9. Criteria: • Types of intermediaries • Number of intermediaries • Terms and responsibilities of intermediaries Identifying major channel alternatives
- 11. Types: Number of intermediaries Exclusive Severely limiting the number of intermediaries Selective Only some of the intermediaries involved Intensive Too many outlets for selling of goods like snack foods
- 12. • Economic Criteria Evaluating major channel alternatives
- 13. • Control and adaptive criteria Evaluating major channel alternatives
- 14. Slide No. Reference 1 www.thecolourmoon.com 3 www.imgkid.com 5 www.articles.bplans.com 6 www.toolkit.smallbiz.nsw.gov.au 7 www.aliexpress.com,www.behance.net 8 www.caleohealth.ca 10 www.elcocanada.com 12,13 www.slideshare.net References