Place: Marketing Mix

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  • Place
    • Channels of Distribution
      • No intermediaries-producer- consumer (Bakery)
        • - More difficult for consumers to shop around. - difficult to reach a large range of customers. - after sales service may not be as good.
        • + Cheaper= no other companies involved.  + Fast to get product from production line to consumer
      • One Intermediariy= producer- retailer- consumer (Supermarket)
        • + No wholesaler needed so it should be faster to get to the shops and should be cheaper as wholesalers do not need to make their profit. + Retailer can arrange a discount for buying large amounts from the producer. + Producer can get feedback from the customer
        • - Retailer has to pay for transporting the goods from the producer. - Retailer has to have large premises to store all the goods.
      • Two intermediaries= producer- wholesaler-Retailer- Consumer (Small Supermarket)
        • + Retailer  only needs to buy the amount they think they can sell. + Retailer will have a large choice of products to choose from. + low storage costs for retailer.
        • - More expensive as a wholesaler needs to make a profit. - Can be slow as goods need to go through an extra channel.
    • Effects of Distribution Decisions
      • COST: can be cheaper to sell a product direct to customer as each intermediaries will add on a profit price is greater.
      • MARKET COVERAGE: To get wide coverage will need to used inetmediaries - reach all of potential audience alone.
      • CONTROL: The more intermediaries used the less control a company has over the price/ way its sold/ displayed.

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