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56-623: Sky-Watcher is a commercial distribution company established in 1999 by the Synta Technology Corporation of Taiwan (Synta Taiwan). It markets telescopes and astronomy equipment, such as mounts and eyepieces , aimed at the amateur astronomy market. The products are manufactured at Synta Taiwan's Suzhou Synta Optical Technology Co., Ltd. in Suzhou (Jiangsu) , China . The brand is distributed in Canada , Europe and in

112-476: A marketing channel , also known as a distribution channel. A marketing channel is the people, organizations, and activities necessary to transfer the ownership of goods from the point of production to the point of consumption. It is the way products get to the end-user, the consumer. This is mostly accomplished through merchant retailers or wholesalers or, in the international context, by importers. In certain specialist markets, agents or brokers may become involved in

168-737: A channel of distribution, it is important to remember that the exploitation and utilization of intermediaries in a business (not only wholesalers, retailers but also transport logistics) will lengthen the chain of distribution. A business will then need to consider which channel is more cost-effective and productive in terms of timely delivery, efficiency, pricing policy, and where it stands among competitors; for example, overall feedback, higher rating, and higher demand from customers. The best use and help of intermediaries can be applied to start-up businesses and perhaps an established business. Brands involved in selling through marketing channels (also commonly known as distribution channels) have relationships with

224-413: A distribution channel is a strategic level decision. Strategically, there are three approaches to distribution: Summary of strategic approaches to distribution In consumer markets, another key strategic level decision is whether to use a push or pull strategy. In a push strategy , the marketer uses intensive advertising and incentives aimed at distributors, especially retailers and wholesalers, with

280-427: A distribution network, there are three broad approaches to distribution, namely mass, selective and exclusive distribution. The number and type of intermediaries selected largely depends on the strategic approach. The overall distribution channel should add value to the consumer. Distribution is fundamentally concerned with ensuring that products reach target customers in the most direct and cost-efficient manner. In

336-421: A distribution system, the supplier needs to determine what distribution channel to achieve in broad terms. The approach to distributing products or services depends on a number of factors including the type of product, especially perishability ; the market served; the geographic scope of operations and the firm's overall mission and vision. The process of setting out a broad statement of the aims and objectives of

392-722: A head office in Singapore which can be used by manufacturers outside the region to increase their regional market penetration and grow sales. Channel-switching (not to be confused with zapping or channel surfing on TV) is the action of consumers switching from one type of channel intermediary to a different type of intermediary for their purchases. Examples include switching from brick-and-mortar stores to online catalogues and e-commerce providers; switching from grocery stores to convenience stores or switching from top tier department stores to mass market discount outlets. A number of factors have led to an increase in channel switching behaviour;

448-409: A major trigger for disintermediation in some industries. Certain types of traditional intermediaries are dropping by the wayside. Marketing channel A marketing channel consists of the people, organizations, and activities necessary to transfer the ownership of goods from the point of production to the point of consumption . It is the way products get to the end-user , the consumer ; and

504-549: A powerful channel member may coordinate the interests of the channel for personal gain. Territories are often seen as a source of conflict, sometimes because boundaries are only loosely defined. American building materials supplier Johns Manville noted in the years before the US entered World War II that distributors needed support in a range of practical areas if they were going to be successful in connecting with housing developers, and instituted "Housing Guilds" which brought together

560-456: A product line they call Flex Tube-Dobsonians. Sky-Watcher products include telescopes, spotting scopes, mounts, and other accessories. Distribution (business) Decisions about distribution need to be taken in line with a company's overall strategic vision and mission . Developing a coherent distribution plan is a central component of strategic planning . At the strategic level, as well as deciding whether to distribute directly or via

616-457: A push strategy, the promotional mix would consist of trade advertising and sales calls while the advertising media would normally be weighted toward trade magazines, exhibitions, and trade shows while a pull strategy would make more extensive use of consumer advertising and sales promotions while the media mix would be weighted toward mass-market media such as newspapers, magazines, television, and radio. Distribution of products takes place through

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672-428: A risk leading distributors to move their business to other supply lines. Channel conflict can arise when one intermediary's actions prevent another intermediary from achieving their objectives. Vertical channel conflict occurs between the levels within a channel, and horizontal channel conflict occurs between intermediaries at the same level within a channel. Channel conflict is a perennial problem. There are risks that

728-412: A single organization uses a variety of different channels to reach its markets, this is known as a multi-channel distribution network. In addition, online retailing or e-commerce is leading to disintermediation , the removal of intermediaries from a supply chain. Retailing via smartphone or m-commerce is also a growth area. The firm's marketing department needs to design the most suitable channels for

784-577: A smaller segment of the market have influence over producers and, therefore, goods that are produced in response to the orders of a few consumers are taken into account. Normally goods and services from this channel are not utilized by large market segments. Moreover, the price of the goods may be subject to significant fluctuations. For example, high demand dictates an increase in the price. In addition, this particular channel has three main ways of direct selling and these include; peddling, mail-order sales and trade through manufacturer-owned stores. Peddling

840-480: A wider variety in lesser quantities. Therefore, it is highly essential to distribute goods from different manufacturers to suit consumers needs and wants. When creating a retail store, buyer effort when making a purchase is considered. For example, stores that sell everyday consumer goods are conveniently located in a nearby neighbourhood for residents. The speed and convenience of service for clients’ interests are put in high priority. An equally important component of

896-605: Is a good strategy to use for producers to get the product to the end-user rapidly. Depending on the form of the retail property, operators can be an independent company, owned by various owners or to engage in the retail network. Intermediaries (retail service) are useful due to their experience, professionalism, ability to offer products to the target market, and connections in the industry, as well as advantages in specialization and high quality of work. In other words, manufacturers produce large quantity of goods and products but are limited in its assortment and merchandise. Consumers seek

952-522: Is also known as a distribution channel . A marketing channel is a useful tool for management, and is crucial to creating an effective and well-planned marketing strategy. Another less known form of the marketing channel is the Dual Distribution channel. This channel is a less traditional form that allows the manufacturer or wholesaler to reach the end-user by using more than one distribution channel. The producer can simultaneously reach

1008-428: Is always on the look out for orders from different clients and actively promotes producer's products and services. The main tasks of a distributor are to study the market and the creation of databases of consumers, advertising of goods, an organization of services for the delivery of goods, stocking up the inventory levels, the creation of a stable sales network, which includes dealers and other intermediaries, depending on

1064-408: Is an apple orchard: Apple orchard > Transport > Processing factory > Packaging > Final product to be sold > Apple pie eaten An alternative term is distribution channel or 'route-to-market'. It is a 'path' or 'pipeline' through which goods and services flow in one direction (from vendor to the consumer), and the payments generated by them flow in the opposite direction (from consumer to

1120-400: Is an outdated version of trade between two parties and consignments are often sold in small amounts by sellers who are traveling to different places. For example, sales representative sells New Wave cosmetics to housewives by using a method of peddling. Mail-order sales are usually used to sell catalogs, books etc., except industrial and bulky goods. For example, a firm sells collectibles through

1176-564: Is co-created by all the players within the distribution chain, including the value created by customers themselves. This emphasis on value-creation is contributing to a change in terminology surrounding distribution processes; "distribution networks" are often termed value-chains while "distribution centers" are often termed customer fulfillment centers . For example, the retail giant Amazon , which utilizes both direct online distribution alongside bricks and mortar stores, now calls its distribution centers "customer fulfillment centers". Although

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1232-508: Is usually dependent on the commission of a sold product or production in terms of goods, and also is involved in one-off transactions and can not be an effective channel of distribution. However, he can maintain a competitive advantage over other firms in the form of a particular brand if he has obtained the right to exclusively represent the manufacturer, and earn profit. He acts on behalf of the seller (producer or manufacturer) and has no rights to modify prices for products. Besides, having formed

1288-506: The advantages of mass production to produce and sell big lots (batches) while retailers look and prefer purchasing smaller consignments. This method for factories could lead to instant sales, high efficiency, and cost-effectiveness. Therefore, particularly in these situations, wholesaler now plays a role where it reconciles these contradictory aspirations. The wholesaler purchases big lots and resells them to retailers in smaller lots. The transportation of products become less burdensome because

1344-500: The amount of delivered goods diminishes through the use of this channel (the wholesale). For example, if five manufacturers supply goods directly to a hundred different retail stores, then they will have to have 500 of deliveries (5 times 100). However, if those five manufacturers supply to the same wholesaler, and the wholesaler at this stage provides 100 different retailers, then the total number of deliveries will decrease to 105 (5 plus 100). Another important component to consider in

1400-413: The amount of segments of the market is not enormous, and the assortment of goods and products is broad. Ultimately, the significance of intermediaries in distribution business is vital as they help consumers obtain particular goods of a specific brand without unnecessary steps. Thus, mediators play a crucial role in establishing a correspondence between demand and supply. Wholesalers buy the products from

1456-441: The case of services, distribution is principally concerned with access. Although distribution, as a concept, is relatively simple, in practice distribution management may involve a diverse range of activities and disciplines including detailed logistics , transportation , warehousing, storage, inventory management as well as channel management, including selection of channel members and rewarding distributors. Before designing

1512-568: The channel partners (local resellers, retailers, field agents, etc.) that sell their products or services to the end customer. Brands that aim to maximize sales through channel partners provide them with advertising and promotional support that is pre-configured and often subsidized by the brand. Brands carry out online and offline advertising on behalf of channel partners to aid them in generating sales of their branded products. Those online and offline marketing initiatives can either be isolated or coordinated to inform one another. An example of this

1568-411: The competitive advantage of the manufacturer. For example, an agent who is able to vary prices for certain products can negotiate and or lower prices. This will assist him in sustaining the comparative advantage, remain on top of its competitors and fulfil market demand. A broker works mainly to bring the seller and the buyer together, and to assist in the negotiation process. An intermediary like broker

1624-401: The consumer through a direct market, such as a website, or sell to another company or retailer that will reach the consumer through another channel, i.e., a store. An example of this type of channel would be franchising . The role of marketing channels in marketing strategies There are four main types of marketing channels. The producer sells the goods or provides the service directly to

1680-510: The consumer with no involvement with a middle man such as an intermediary , a wholesaler , a retailer , an agent, or a reseller . The consumer goes directly to the producer to buy the product without going through any other channel. This type of marketing is most beneficial to farmers who can set the prices of their products without having to go through the Canadian Federation of Agriculture . Typically, goods that are consumed by

1736-402: The consumer. However, the wholesaler does not always sell directly to the consumer. Sometimes the wholesaler will go through a retailer before the product gets into the hands of the consumer. Each dealer (the manufacturer, the wholesaler, and the retailer) will be looking to make a decent profit margin from the product. Hence, each time the buyer purchases the merchandise from another source,

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1792-808: The distributor (as the materials supplier), design services, sub-contractors, local realtors and housing financiers. Laurence C. Hart refers to the extensive development of these guilds and the "Training Schools" which they operated, converting these into a radio-based program from 1942. Hart, who worked for the supplier, put this experience forward to the American Marketing Association as "an outstanding example of manufacturer-distributor collaboration on an industry-wide basis". Companies wishing to grow through sales to new markets may need to identify and develop relationships with local distributors, for example to support export to new markets. In southeast Asia , for example, many distributors have

1848-438: The expectation that they will stock the product or brand, and that consumers will purchase it when they see it in stores. In contrast, in a pull strategy , the marketer promotes the product directly to consumers hoping that they will pressure retailers to stock the product or brand, thereby pulling it through the distribution channel. The choice of a push or pull strategy has important implications for advertising and promotion. In

1904-462: The fact that producers, agents, retailers/wholesalers and consumers of this channel aid each other and benefit from each other. Their cooperation generates a greater output in terms of further profitability, by discernment and exploring newer markets of sales, and building a better business relationship. The participants of distribution channels must have knowledge and experience not only for the effective maintenance of target segments but also to maintain

1960-402: The firm's products, then select appropriate channel members or intermediaries. An organization may need to train staff of intermediaries and motivate the intermediary to sell the firm's products. The firm should monitor the channel's performance over time and modify the channel to enhance performance. To motivate intermediaries the firm can use positive actions, such as offering higher margins to

2016-457: The growth of e-commerce, the globalization of markets, the advent of category killers (such as Officeworks and Kids 'R Us ) as well as changes in the legal or statutory environment. For instance, in Australia and New Zealand, following a relaxation of laws prohibiting supermarkets from selling therapeutic goods, consumers have gradually switched away from pharmacies and toward supermarkets for

2072-433: The intermediary, special deals, premiums and allowances for advertising or display. On the other hand, negative actions may be necessary, such as threatening to cut back on margin, or hold back delivery of product. Care must be exercised when considering negative actions as these may fall foul of regulations and can contribute to a public backlash and a public relations disaster. Manufacturer complacency has been highlighted as

2128-399: The item is perishable and has to get to the market fresh before it starts to rot. At times, the agent will directly go to the retailer with the goods, or take an alternate route through the wholesaler who will go to a retailer and then finally to the consumer. A mutual cooperation normally occurs when parties, in particular, the last channel of marketing chain of distribution meet, due to

2184-730: The late 2000s, it was extended to the United States market. In 1999, the Sky-Watcher brand was established to sell Synta Taiwan's optics, with head offices in Richmond, British Columbia , Canada. They began producing Dobsonian telescopes in 2000, followed by Maksutov–Cassegrains in 2001, and Apochromat ED-APO refracting telescopes in 2004. Sky-Watcher sells telescopes from 2.4" (62mm) up to 16" (406mm) aperture with manual, motor-driven, or GoTo mounts. Since 2008, Sky-Watcher has manufactured Dobsonians with collapsible tubes,

2240-475: The manufacturer and sell them directly to the consumer. This channel works best for manufacturers that produce shopping goods like clothes , shoes , furniture , tableware , and toys . Since consumers need more time with these types of items before they decide to purchase them, it is in the best interest of the manufacturer to sell them to an intermediary before it gets into the hands of the consumers. Using an established network that already has brand loyalty

2296-408: The manufacturer and sell them to the consumer. In this channel, consumers can buy products directly from the wholesaler in bulk . By purchasing the items in bulk from the wholesaler, the prices of the goods are reduced. This is because the wholesaler takes away extra costs, such as service costs or sales force costs, that customers usually pay when buying from retail; making the price much cheaper for

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2352-452: The market situation. Distributors scarcely sell a manufacturer's goods directly to customers. This distribution channel involves more than one intermediary before the product gets into the hands of the consumer. The middleman, known as the agent, assists with the negotiation between the manufacturer and the seller. Agents come into play when the producers need to get their product into the market as quickly as possible. This happens mostly when

2408-709: The marketing channel: for example in the insurance sector, the European Union has noted that "insurance and reinsurance intermediaries play a central role in the distribution of insurance and reinsurance products" . The EU introduced the Insurance Distribution Directive in 2016 to enhance a level of harmonisation in this market across EU member states. Typical intermediaries involved in distribution include: A firm can design any number of channels they require to reach customers efficiently and effectively. Channels can be distinguished by

2464-401: The need to reduce the time a product spends in transit or in storage. In other cases, distribution systems can become quite complex involving many levels and different types of intermediaries. In practice, many organizations use a mix of different channels; a direct sales force may call on larger customers. This may be complemented with other agents to cover smaller customers and prospects. When

2520-583: The number of intermediaries between producer and consumer. If there are no intermediaries then this is known as a zero-level distribution system or direct marketing . A level one (sometimes called one-tier ) channel has a single intermediary. A level two (alternatively a two-tier ) channel has two intermediaries, and so on. This flow is typically represented as being manufacturer to retailer to consumer, but may involve other types of intermediaries. In practice, distribution systems for perishable goods tend to be shorter - direct or single intermediary, because of

2576-413: The practice of wholesaling is storage. Storage of goods is another work aspect of a wholesaler. Wholesaler regulates the deliveries of goods, having synchronised the production and consumption of material goods. Moreover, the wholesaler, further assumes the financial obligations related to the immobilisation of funds invested in the creation of commodity stocks. Although the chain of transition suggests that

2632-524: The price of the product has to increase, in order to maximize the profit each person will receive. This raises the price of the product for the end-user. Due to the simultaneous and joint work of wholesaler and retailer, a trade can only be beneficial if a market is situated on a large area and the supply of goods is carried out small but urgent consignments (products), it can be cost-effective and profitable by supplying significant consignments (products) to fewer customers. Industrial factories want to utilize

2688-531: The product or service can be found at cheaper prices, when superior models become available, when a wider range is offered, or simply because it is more convenient to shop through a different channel (e.g. online or one-stop shopping). As a hedge against market share losses due to switching behaviour, some retailers engage in multi-channel retailing. The emergence of a service-dominant logic perspective has focused scholarly attention on how distribution networks serve to create customer value and to consider how value

2744-451: The profit of a company which would then result in significant loss and delivery time is shortened due to having no obstacles like middleman etc. Despite these apparent advantages, direct selling has not become a powerful channel. According to an estimate, even less than 3 percent of total consumers’ sales are made in this channel. On the other hand, technological innovations, the aid of the internet and convenient smartphones are now changing

2800-474: The purchase of minor analgesics, cough and cold preparations and complementary medicines such as vitamins and herbal remedies. For the consumer, channel switching offers a more diverse shopping experience, which may concern some sellers by its potential to erode market share. Evidence of channel switching can suggest that disruptive forces are at play, and that consumer behaviour is undergoing fundamental changes. A consumer may be prompted to switch channels when

2856-410: The retail trade is the retail function that play crucial roles. These include research of products, implementation of storage, setting of pricing policy, arrangements of products and its selection for the creation of different merchandise assortments, exploration of the condition prevailing in the market. This channel is considered to be beneficial if the volume of pre-sale and post-sale is insignificant,

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2912-556: The term "customer fulfillment center" has been criticized on the grounds that it is a neologism , its use is becoming increasingly mainstream as it slowly makes its way into introductory marketing textbooks. Disintermediation occurs when manufacturers or service providers eliminate intermediaries from the distribution network and deal directly with purchasers. Disintermediation is found in industries where radically new types of channel intermediaries displace traditional distributors. The widespread public acceptance of online shopping has been

2968-648: The use of mail-order. This method of selling is normally made without eye contact. In the last method (manufacture-owned stores), the manufacturer itself is surrounded by the stores and directly supplies goods to its stores. For example, Singer sells its sewing machines through its own stores. Due to distance of goods and products between producer and a seller, it takes an advantage to be an effective channel of distribution in its kind and these advantages are; producers pay close attention with customers and are aware of theirs' thought's and ideas that are shared with them, there are no intermediaries that could substantially reduce

3024-765: The vendor). A marketing channel can be as short as being direct from the vendor to the consumer or may include several inter-connected (usually independent but mutually dependent) intermediaries such as wholesalers, distributors, agents, retailers. Each intermediary receives the item at one pricing point and moves it to the next higher pricing point until it reaches the final buyer. Marketing Channels can be long term or short term. Short term channels are influenced by market factors such as: business users, geographically concentrated, extensive technical knowledge and regular servicing required, and large orders. Short term product are influenced by factors such as: perishable, complex, and expensive. Short term producer factors include whether

3080-407: The way that commerce works significantly. The proliferation of internet-direct channels means that internet companies will be able to produce and directly trade services and goods with consumers. It can be distributed directly through the internet, for example, services in the sphere of gambling or software such as antivirus programs as such. Retailers like Walmart and Target , buy the product from

3136-465: The wholesaler directly communicates and deals with a manufacturer may not be unambiguous. The contribution of a distributor is highly acknowledged and plays a crucial role in distributing flows of goods before it gets in the hands of wholesalers, retailers and so on. A distributor is the representative of the manufacturer and performs functions on behalf of the manufacturer for the distribution of goods from producer to wholesaler or retailer. A distributor

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