Chapter

18
Managing
Retailing,
Wholesaling,
and Logistics

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Learning Objectives
1.

2.

3.

4.
5.

6.

What major types of marketing intermediaries

occupy this sector?
What major changes are occurring in the modern
retail marketing environment with respect to
competitive market structure and technology?
What marketing decisions do marketing
intermediaries make?
What does the future hold for private label brands?
What are some of the important issues in
wholesaling??
What are some important issues in logistics?
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Retailing
Retailing
All the activities in selling
goods or services directly to
final consumers for personal,
nonbusiness use

Retailer/retail store
Any business enterprise
whose sales volume comes
primarily from retailing
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Types of retailers
Store retailers, nonstore retailers,
and retail organizations

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Types of retailers
Store retailers:

Specialty store
Department store
Supermarket
Convenience store
Drug store

Discount store
Extreme value or harddiscount store
Off-price retailer
Superstore
Catalog showroom

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Types of retailers
Levels of service for store retailers
Self-service
Self-selection
Limited service
Full service

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Types of retailers
Nonstore retailing
Direct marketing
Direct selling
Automatic vending
Buying services

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Types of retailers
Corporate retailing and franchising

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Corporate Retailing and

Franchising
Franchises are distinguished by three
characteristics:
The 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
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The Modern Retail Marketing

Environment
Competitive retail market structure
New retail forms and combinations
Growth of giant retailers
Growth of intertype competition
Emergence of fast retailing
Decline of middle-market retailers

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The Modern Retail Marketing

Environment
Role of technology
Retailers use
technology for
business operations,
to enhance the
consumer shopping
experience inside the
store, and
Internet/social media
strategies
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Marketing Decisions
Target market
Channels
Product
assortment
Procurement
Prices

Services
Store atmosphere
Store activities
and experiences
Communications
Location

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Product Assortment
Develop product differentiation
Feature exclusive national brands
Feature private-label merchandise
Feature distinctive-merchandise events
Feature ever-changing merchandise
Feature the latest merchandise first
Offer merchandise-customizing services
Offer a highly targeted assortment
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Services
Retailers must decide on the services
mix to offer customers:
Prepurchase services
Postpurchase services
Ancillary services
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Location
Central
business
districts

Regional
shopping
centers
Community
shopping
centers

Stand-alone
stores
Location within
a larger store

Shopping
strips

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Private Labels
A private-label brand is a brand that
retailers and wholesalers develop
Role of private labels
Private-label success factors

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Wholesaling
Wholesaling
includes all the
activities in
selling goods or
services to those
who buy for
resale or
business use
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Major wholesaler types

Merchant
wholesalers

Full-service
wholesalers
Limitedservice
wholesalers

Specialized
wholesalers
Manufacturers/
retailers
branches/offices

Brokers and
agents

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Wholesaler functions
Selling and
promoting
Buying and
assortment
building
Bulk breaking
Warehousing

Transportation
Financing
Risk bearing
Market
information
Management
services and
counseling

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Market Logistics
Supply chain
management
(SCM)
Market logistics
Integrated logistics
systems (ILS)
Lean
manufacturing
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Market logistics planning

1. Deciding on companys
value proposition
2. Selecting best channel
design and network strategy
3. Developing operational
excellence
4. Implementing solution

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Market-Logistics Decisions
Order processing: how should we
handle orders?
Warehousing: where should we
locate our stock?
Inventory: how much stock should we
hold?
Transportation: how should we ship
goods?
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Figure 18.1
Optimal Ordering Quantity

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Transportation
Containerization
Piggyback,
fishyback,
trainship, and
airtruck

Private vs.
contract vs.
common
carriers
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