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©2000 Prentice Hall
ObjectivesObjectivesObjectivesObjectives
RetailingRetailing WholesalingWholesaling Market LogisticsMarket Logistics
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Four Levels of Retail ServiceFour Levels of Retail ServiceFour Levels of Retail ServiceFour Levels of Retail Service
Self-serviceSelf-service Self-selectionSelf-selection Limited-serviceLimited-service Full-serviceFull-service
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Classification Of Retailer TypesClassification Of Retailer Types
Specialty StoresSpecialty Stores
Department StoresDepartment Stores
SupermarketsSupermarkets
Convenience StoresConvenience Stores
Off-Price RetailerOff-Price Retailer
SuperstoresSuperstores
Catalog ShowroomCatalog Showroom
Wide Variety of Product Lines i.e. Clothing, Home Furnishings, & Household Items
Wide Variety of Product Lines i.e. Clothing, Home Furnishings, & Household Items
Wide Variety of Food, Laundry, & Household ProductsWide Variety of Food, Laundry, & Household Products
Limited Line of High-Turnover Convenience GoodsLimited Line of High-Turnover Convenience Goods
Inexpensive, Overruns, Irregulars, and Leftover GoodsInexpensive, Overruns, Irregulars, and Leftover Goods
Large Assortment of Routinely Purchased Food & Nonfood Products, Plus Services
Large Assortment of Routinely Purchased Food & Nonfood Products, Plus Services
Broad Selection, Fast Turnover, Discount PricesBroad Selection, Fast Turnover, Discount Prices
Narrow Product Line, Deep AssortmentNarrow Product Line, Deep Assortment
Store Type Length and Breadth of Product Assortment
Discount StoresDiscount Stores Broad Product Line, Low Margin, High VolumeBroad Product Line, Low Margin, High Volume
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Types of NonStore RetailingTypes of NonStore RetailingTypes of NonStore RetailingTypes of NonStore Retailing
Direct SellingDirect Selling
Direct MarketingDirect Marketing
Buying ServicesBuying Services
NonStore Retailing Accounts for More Than 12% of All Consumer Purchases, and is trending up.
Automatic VendingAutomatic Vending
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Low PriceLow StatusLow Margin
Mid PriceMid StatusMid Margin
High PriceHigh StatusHigh Margin
Wheel of RetailingWheel of RetailingWheel of RetailingWheel of Retailing
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Why are Wholesalers Used?Why are Wholesalers Used?Why are Wholesalers Used?Why are Wholesalers Used?
WholesalerFunctions
ManagementServices & Advice
ManagementServices & Advice
Selling andPromoting
Selling andPromoting
MarketInformation
MarketInformation
Buying andAssortment Building
Buying andAssortment Building
Risk BearingRisk Bearing Bulk BreakingBulk Breaking
TransportingTransporting
FinancingFinancing WarehousingWarehousing
©2000 Prentice Hall
Goals of the Logistics SystemGoals of the Logistics SystemGoals of the Logistics SystemGoals of the Logistics System
• Provide a Targeted Level of Customer Service at the Least Cost.
• Maximize Profits, Not Sales.
Higher Distribution Costs/ Higher Customer Service Levels
Lower Distribution Costs/ Lower Customer Service Levels
©2000 Prentice Hall
InventoryWhen to order
How much to orderJust-in-time
InventoryWhen to order
How much to orderJust-in-time
CostsMinimize Costs ofAttaining Logistics
Objectives
CostsMinimize Costs ofAttaining Logistics
Objectives
WarehousingStorage
Distribution
WarehousingStorage
Distribution
Order ProcessingSubmittedProcessed
Shipped
Order ProcessingSubmittedProcessed
Shipped
Logistics
FunctionsTransportation Water, Truck, Rail, Pipeline & Air
Logistics SystemsLogistics SystemsLogistics SystemsLogistics Systems
©2000 Prentice Hall
RailNation’s largest carrier, cost-effective for shipping bulk products, piggyback
RailNation’s largest carrier, cost-effective for shipping bulk products, piggyback
TruckFlexible in routing & time schedules, efficient
for short-hauls of high value goods
TruckFlexible in routing & time schedules, efficient
for short-hauls of high value goods
WaterLow cost for shipping bulky, low-value
goods, slowest form
WaterLow cost for shipping bulky, low-value
goods, slowest form
PipelineShip petroleum, natural gas, and chemicals
from sources to markets
PipelineShip petroleum, natural gas, and chemicals
from sources to markets
AirHigh cost, ideal when speed is needed or to
ship high-value, low-bulk items
AirHigh cost, ideal when speed is needed or to
ship high-value, low-bulk items
Transportation ModesTransportation ModesTransportation ModesTransportation Modes
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1. Speed.
2. Dependability.
3. Capability.
4. Availability.
Checklist for Choosing
Transportation Modes
©2000 Prentice Hall
Rating Transportation ModesRating Transportation Modes
RailRail 33 44 22 22 33
WaterWater 44 55 11 44 11
TruckTruck 22 22 33 11 44
PipelinePipeline 55 11 55 55 22
AirAir 11 33 44 33 55
Source:Source: See Carl M. Guelzo; See Carl M. Guelzo; Introduction to Logistics Management Introduction to Logistics Management Englewood Cliffs, NJ:Englewood Cliffs, NJ:Prentice Hall, 1986), p. 46.Prentice Hall, 1986), p. 46.
(Door-to-door
deliverytime)
(MeetingScheduleson Time)
(Ability toHandleVarious
Products)
(No. ofGeographic
PointsServed)
(PerTon-Mile)
Speed Dependability Capability Availability Cost
