Distribution policy

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The distribution policy (also distribution mix, distribution policy or place within the marketing mix ; from Latin distributio 'distribution') shapes all decisions and sales activities within marketing on the path of a product or service from the provider to the customer or user. A distinction is made between logistical (transport and warehousing) and acquisition-based sales, which are about the design of the sales strategy and the sales process . Because of the increasing importance of the acquisition aspect, distribution policy is increasingly being replaced by sales policy in more recent textbooks .

Decision-making areas

Distribution policy deals with the question of how and through what routes the products get from the manufacturers to the buyers. There are four main areas:

In addition, the distribution policy includes decisions about

  • Distribution organs
  • Through acquisition-based distribution ( sales ), customer contacts are established, market coverage is achieved and revenue is generated.
  • On the one hand, the distribution logistics generate costs, and on the other hand, it enables a high level of readiness to deliver as the basis for customer satisfaction . In this respect, distribution policy, like all other instrumental areas of marketing, represents both a cost factor and a source of revenue. In addition, the decision on the sales method sets the course for the use of further marketing instruments.

In particular through the sales channels -Choice the distribution policy is also known as Channel Marketing and Channel Management referred, with Channel represents the distribution channel and sales channel.

Influencing factors

Factors influencing distribution policy decisions are:

Performance-related factors

These include all performance features that require a special form of distribution or logistics, for example

Customer-related factors

These relate to the requirements and ideas on the part of current and potential customers:

  • Number of customers (few, many)
  • geographical distribution (densely packed, widely distributed),
  • Purchase frequency (frequency of needs on the part of customers),
  • Shopping habits (geographical, temporal, preferred procurement channels) and
  • Open-mindedness towards sales methods such as online shops , shop TV or power shopping .
  • Who comes to whom? ( Company to customer / customer to company)

Competitive factors

Depending on the competitive forces, distribution policy decisions are also shaped by the competitive behavior, which in principle offers the possibility of differentiation or adaptation to the competitive methods, namely with regard to

  • Number of competitors,
  • Market position of the competitor,
  • Type of competing products as well
  • Sales channels (e.g. shipping, door-to-door sales, Internet).

Company-related factors

Of course, the factors of the respective company cannot be neglected. Numerous factors influence the room for maneuver, for example

  • Size,
  • Financial strength,
  • Experience,
  • Market conception as well
  • Market power .

Legal factors

Not least the legal framework conditions shape distribution policy decisions; are generally to be checked

  • Protection of sales relationships in certain industries,
  • Reservation and distribution reservations for certain types of business,
  • Compensation claims, for example by the commercial agent in the event of the business relationship being broken off and
  • possible prohibitions of discrimination and boycott .

Acquisition distribution

The selection of the sales channels or distribution channels is an essential task of the sales strategy . Basically, one can differentiate between direct and indirect sales channels. If the distribution policy basic options are assigned to the institutional economic transaction type band “ market , cooperation , integration or hierarchy ”, direct distribution systems can be characterized as vertically integrative transaction types, which are often characterized by the marketing leadership of the manufacturer (secured distribution or secured distribution ). Indirect distribution systems, d. H. Systems in which consumer goods manufacturers have an indirect distributive relationship with consumers through the involvement of independent sales intermediaries, in particular trading companies , are to be classified as a market type of transaction ( conventional distribution systems), provided the sales intermediaries do not have any contracts or contractual relationships that go beyond the purchase agreement talk to the manufacturer. Between these two poles of the types of transaction types there is a broad spectrum of vertically cooperative forms of distribution (controlled distribution or controlled distribution ) that overlap more or less with regard to the degree of link between the retail and the manufacturer level and thus the power potential of the manufacturer level .

Overview

The market in which the company wants to sell its services has to be processed differently depending on the company objective , sales strategy and status of the product life cycle of a service. The type of service and the target market influence the choice of distribution channels .

The entrepreneurial goal ( penetration or absorption ) depends on the status of a service within its life cycle. This has an influence on the intensity of market cultivation and thus on the choice of pricing policy and the means of market communication used .

The distribution policy thus corresponds strategically with the neighboring areas within marketing and creates operational targets for practical sales . To this end, the companies are the various forms of distribution in the sale are available:

  • Special forms of sales

Direct sales

With direct sales, the service changes hands only once after production, namely from the manufacturer to the customer. This form is found primarily in sales to companies , although there are also direct sales companies that specialize in sales to end customers . These then advertise with the real customer benefit of saving high intermediate costs. Direct sales can take place either in person or through electronic media.

The importance of direct sales is increasing, especially against the background of new information and communication technologies. Direct sales tend to be strong in capital goods , while indirect sales predominate in consumer goods . This is related to the need for explanation and consideration of individual requirements for capital goods. Capital goods consist of a bundle of goods and services, which is why one or more manufacturers often take on the acquisition function as part of a system selling .

Indirect distribution

In regular sales through wholesalers and retailers , the service usually changes hands several times along the so-called value chain after production . In the consumer goods market in particular, where large quantities of goods and their presentation in the shop are important, distribution through trading companies (commercial sales ) is predominant, and authorized dealers are often involved in distribution.

In the case of indirect sales, wholesalers and / or retailers are regularly involved as sales intermediaries . Various criteria must be taken into account here, such as the desired ubiquity or degree of distribution , the selection of suitable companies (exclusive, selective or mass distribution) and the structure of the business relationships. A special form is commission sales by trading companies, in which the goods remain the property of the manufacturer until they are sold.

Indirect sales also include sales via commercial representatives (agents) or commercial representations (agencies). Commercial agents, as independent traders, are entrusted with mediating or concluding business for one or more companies (one-company / multi-company representatives). On the basis of a legal continuing obligation ( commercial agency contract ), commercial agents work in the name and for the account of others. The growth, the increasing independent marketing (sales agent marketing) as well as the increasing importance of sales agents are moving sales agents more and more into the rank of autonomous sales systems. The trade intermediaries as a link between the market levels play an important role in the German economy. They broker goods worth around 175 billion euros each year, including their own turnover of around 5 billion euros per year. This results in a degree of involvement in the domestic flow of goods of 30 percent.

In the case of franchising , sales are also carried out by legally independent companies (franchisees), but so-called franchise fees are incurred for using the uniform system equipment, a uniform name and external appearance. Advantages for the franchisee, especially with well-known systems, are a high level of awareness right from the start, comparatively favorable purchasing conditions and support in the commercial area.

Special forms of sales

In the case of commission business ( commission sales ), a company offers the service in its own name, but for the account of a third party. The commission agent takes the service into custody and takes care of the initiation of the acquisition. The capital risk remains with the manufacturer or importer .

The broker does not work in the mutual contract as the broker is not obliged to act. In contrast to the sales activity, in which an entrepreneur constantly sells newly produced services, it is typical for the broker that the brokerage activity is related to a specific business.

Single vs. Multi-channel distribution

While distribution practice in the past tended to concentrate on one sales channel (single-channel distribution), with the increasing acceptance of the Internet, companies are developing several sales channels at the same time (multi-channel distribution). Multi-channel distribution is the simultaneous use of several sales channels such as retail , internet and field service .

Physical distribution

Another meaning of the term arises from the distribution of goods, which is necessary in trade, over great distances and / or over large areas. Here the term distribution has a logistical character and, in addition to the pure transport reference, is mainly used for the number of sales outlets that carry a certain product. The degree of distribution indicates how many retail companies sell a manufacturer's product, expressed as a percentage of all retail companies that are at most suitable for including the product in their range.

Individual evidence

  1. ↑ for example: C. Homburg, H. Krohmer: Marketingmanagement . 3. Edition. Wiesbaden 2009. or H. Schierenbeck: Fundamentals of Business Administration . 17th edition. Munich 2008.
  2. ↑ Schenk, Hans-Otto: Marktwirtschaftslehre des Handels , Wiesbaden 1991, ISBN 3-409-13379-8 , p. 147.

literature

Web links

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