?2000 Prentice Hall
Objectives
? Retailing
? Wholesaling
? Market Logistics
?2000 Prentice Hall
Four Levels of Retail Service
? Self-service
? Self-selection
? Limited-service
? Full-service
?2000 Prentice Hall
Classification Of Retailer Types
Specialty Stores
Department Stores
Supermarkets
Convenience Stores
Off-Price Retailer
Superstores
Catalog Showroom
Wide Variety of Product Lines i.e,Clothing,Home Furnishings,
& Household Items
Wide Variety of Food,Laundry,& Household Products
Limited Line of High-Turnover Convenience Goods
Inexpensive,Overruns,Irregulars,and Leftover Goods
Large Assortment of Routinely Purchased Food & Nonfood
Products,Plus Services
Broad Selection,Fast Turnover,Discount Prices
Narrow Product Line,Deep Assortment
Store Type Length and Breadth of Product
Assortment
Discount Stores Broad Product Line,Low Margin,High Volume
?2000 Prentice Hall
Types of NonStore Retailing
Direct Selling
Direct Marketing
Buying Services
NonStore Retailing
Accounts for More Than
12% of All Consumer
Purchases,and is
trending up,
Automatic Vending
?2000 Prentice Hall
Low Price
Low Status
Low Margin
Mid Price
Mid Status
Mid Margin
High Price
High Status
High Margin
Wheel of Retailing
?2000 Prentice Hall
Why are Wholesalers Used?
Wholesaler
Functions
Management
Services & Advice
Selling and
Promoting
Market
Information
Buying and
Assortment Building
Risk Bearing Bulk Breaking
Transporting
Financing Warehousing
?2000 Prentice Hall
Goals 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
Inventory
When to order
How much to order
Just-in-time
Costs
Minimize Costs of
Attaining Logistics
Objectives
Warehousing
Storage
Distribution
Order Processing
Submitted
Processed
Shipped
Logistics
Functions Transportation
Water,Truck,
Rail,
Pipeline & Air
Logistics Systems
?2000 Prentice Hall
Rail
Nation’s largest carrier,cost-effective
for shipping bulk products,piggyback
Truck
Flexible in routing & time schedules,efficient
for short-hauls of high value goods
Water
Low cost for shipping bulky,low-value
goods,slowest form
Pipeline
Ship petroleum,natural gas,and chemicals
from sources to markets
Air
High cost,ideal when speed is needed or to
ship high-value,low-bulk items
Transportation Modes
?2000 Prentice Hall
1,Speed,
2,Dependability,
3,Capability,
4,Availability,
Checklist for Choosing
Transportation Modes
?2000 Prentice Hall
Rating Transportation Modes
Rail 3 4 2 2 3
Water 4 5 1 4 1
Truck 2 2 3 1 4
Pipeline 5 1 5 5 2
Air 1 3 4 3 5
Source,See Carl M,Guelzo; Introduction to Logistics Management Englewood Cliffs,NJ,
Prentice Hall,1986),p,46,
(Door-to-
door
delivery
time)
(Meeting
Schedules
on Time)
(Ability to
Handle
Various
Products)
(No,of
Geographic
Points
Served)
(Per
Ton-
Mile)
Speed Dependability Capability Availability Cost