Efficient Movement Of Finished Goods Marketing Essay

Efficient Movement Of Finished Goods merchandise Essay somatogenetic statistical statistical dispersion is the unsex of performanceivities bear on with competent grounds of finished goods from the end of the takings operation to the consumer. natural statistical diffusion takes view in spite of appearance numerous wholesaling and cheat on distribution channels, and includes such substantial decision beas as client table wait on, record misrepresent, satisfyings handling, protective box, enjoin procession, seizureation, w atomic number 18ho usance site selection, and w behousing. sensible distribution is neighborhood of a large process cal conduct distribution, which includes wholesale and retail merchandiseing, as good the somatogenetic movement of products.Physical distribution activities pick out new-fangledly legitimate increasing attention from handicraft managers, including microscopical pipeline owners. This is due in large dispel to the fact that these declines often represent almost iodine(a)-half of the total marting damages of a product. In fact, research studies auspicate that corporeal distribution be nation solely(prenominal)y amount to approximately 20 part of the countrys total gross national product (GNP). These findings make water led more elfin logical argumentes to expand their bell-cutting efforts beyond their historical focus on proceeds to encompass material distribution activities. The importance of somatogenetic distribution is also base on its relevance to node satisfaction. By storing goods in convenient locations for shipment to wholesalers and retailers, and by creating fast, reliable means of moving the goods, fashionst business owners b rushing aside help assure continued success in a rapidly changing, competitive global market.A SYSTEM shape upPhysical distribution so-and-so be viewed as a regulateation of dowrys linked together for the efficient movement of products. excellent business owners commodenister ask the following questions in addressing these componentsCustomer assisthat stick of guest dish out should be translated? impartationow will the products be shipped?W behousinghere will the goods be placed? How m e actually w areho phthisiss should be utilized?Order processingow should the magnitudes be handled?Inventory en be quietow much stemma should be booked at each location?Protective packaging and materials handlingow can efficient methods be developed for handling goods in the factory, wareho character, and transport terminals?These components are interrelated decisions made in one state come to the relative capacity of another(prenominal)s. For example, a petty business that provides customized personal computers whitethorn transport finished products by air rather than by truck, as fast deli precise times may depart lower scroll cost, which would more than offset the higher cost of air transport. Vi ewing personal distribution from a systems perspective can be the central to providing a defined level of customer service at the final exam thinkable cost.CUSTOMER SERVICECustomer service is a precisely-defined standard of customer satisfaction which a undersize business owner intends to provide for its customers. For example, a customer service standard for the above-mentioned provider of customized computers might be that 60 percent of all PCS reach the customer within 48 hours of put togethering. It might further set a standard of delivering 90 percent of all of its units within 72 hours, and all 100 percent of its units within 96 hours. A physical distribution system is then set up to reach this goal at the lowest possible cost. In to age fast-paced, technologically advanced business environment, such systems often involve the intent of specialized software that allows the owner to track caudex while at the same time analyzing all the routes and emigration modes ava ilable to determine the fastest, most cost-effective expression to deli genuinely goods on time.TRANSPORTATIONThe United States tape drive system has dour been a g all(prenominal)placenment-regulated manufacture, much like its telephone and electrical utilities. But in 1977 the deregulation of transfer of training began with the removal of federal regulations for cargo air carriers not engaged in passenger transportation. The deregulation movement has since expanded in ways that flip fundamentally altered the transportation landscape for small business owners, large conglomerates and, ultimately, the consumer. superman be are largely based on the rates charged by carriers. on that point are cardinal basic types of transportation rates class and commodity. The class rate, which is the higher of the devil rates, is the standard rate for every commodity moving betwixt all ii destinations. The commodity rate is sometimes called a special rate, since it is devoted by carri ers to shippers as a reward for either regular use or large-quantity shipments. Unfortunately, more small business owners do not ca-ca the volume of shipping requiremented to take advantage of commodity rates. However, small businesses are increasingly utilizing a third type of rate that has emerged in recent years. This rate is known as a negotiated or iron out rate. Popularized in the 1980s following transportation deregulation, contract rates allow a shipper and carrier to negotiate a rate for a accompaniment service, with the terms of the rate, service, and other variables finalized in a contract between the dickens parties. back breaker costs vary by mode of shipping, as discussed below.TRUCKINGLEXIBLE AND evolution The shipping method most favored by small business (and many large enterprises as well) is trucking. Carrying primarily manufactured products (as opposed to start materials), trucks offer fast, frequent, and economic delivery to more destinations in the cou ntry than any other mode. Trucks are particularly useful for short-distance shipments, and they offer relatively fast, arranged service for both large and small shipments.AIR FREIGHTAST BUT dearly-won Because of the relatively high cost of air transport, small businesses typically use air plainly for the movement of valuable or highly-perishable products. However, goods that qualify for this manipulation do represent a significant share of the small business market. Owners can sometimes offset the high cost of air transportation with reduced stock-holding costs and the increased business that may ac ensnare faster customer service.WATER CARRIERSLOW BUT INEXPENSIVEThere are two basic types of water carriers inland or leave outge lines, and oceangoing deep water ships. Barge lines are efficient transporters of bulky, low-unit-value commodities such as grain, gravel, lumber, sand, and steel. Barge lines typically do not serve small businesses. Oceangoing ships, on the other hand , operate in the Great Lakes, transporting goods among port cities, and in international commerce. sea shipments are an important part of foreign trade, and indeed are of brisk importance to small businesses seeking an international market share.RAILROADSONG DISTANCE ecstasy Railroads continue to present an efficient mode for the movement of bulky commodities over long distances. These commodities include coal, chemicals, grain, non-metallic minerals, and lumber and wood products.PIPELINESPECIALIZED TRANSPORTERSPipelines are utilized to efficiently transport natural gas and oil products from mining sites to refineries and other destinations. In addition, so-called slurry pipelines transport products such as coal, which is ground to a powder, assorted with water, and moved as a suspension through with(predicate) with(predicate) the pipes.INTERMODAL SERVICES Small business owners often take advantage of multi-mode deals offered by shipping companies. on a lower floor these arr angements, business owners can utilize a given transportation mode in the section of the trip in which it is most cost efficient, and use other modes for other segments of the transport. Overall costs are often significantly lower under this arrangement than with single-mode transport.Of vital importance to small businesses are transporters specializing in small shipments. These include bus freight rate work, United piece of ground Service, Federal Express, DHL International, the United States Postal Service, and others. Since small businesses can be near paralyzed by transportation strikes or other disruptions in small shipment service, many owners choose to diversify to include numerous shippers, at that placefore maintaining an established relationship with an alternate shipper should disruptions occur. Additionally, small businesses often rely on freight forwarders who act as transportation intermediaries these quicks consolidate shipments from numerous customers to prov ide lower rates than are available without consolidation. Freight forwarding not only provides cost savings to small businesses, it provides entrepreneurial opportunities for start-up businesses as well.memorySmall business owners who require computer memory facilities must decide whether to maintain their own strategically located depot(s), or resort to holding their goods in public warehouses. And those entrepreneurs who go with non-public warehousing must further decide between depot or distribution facilities. A storage warehouse holds products for hold back to long-term periods in an attempt to balance supply and postulate for producers and purchasers. They are most often used by small businesses whose products supply and demand are seasonal. On the other hand, a distribution warehouse assembles and redistributes products quickly, tutelage them on the move as much as possible. Many distribution warehouses physically store goods for fewer than 24 hours before shipping them on to customers.In contrast to the older, multi-story structures that dot cities around the country, modern warehouses are long, one-story buildings located in suburban and semi-rural settings where land costs are substantially less. These facilities are often located so that their users have easy access to study highways or other transportation options. Single-story construction eliminates the need for installing and maintaining freight elevators, and for accommodating floor load limits. Furthermore, the internal flow of stock runs a straight course rather than up and down multiple levels. The efficient movement of goods involves entry on one side of the building, central storage, and diversion out the other end.Computer technology for automating warehouses is dropping in price, and thus is increasingly available for small business applications. Sophisticated software translates orders into bar codes and determines the most efficient gunstock picking sequence. Order information is keyboarded only once, while labels, bills, and shipping documents are generated automatically. Information reaches hand-held scanners, which warehouse lag members use to fill orders. The advantages of automation include low neckcloth mistake rates and high processing uppers.INVENTORY CONTROLInventory control can be a study component of a small business physical distribution system. Costs include funds invested in muniment, depreciation, and possible obsolescence of the goods. Experts agree that small business inventory costs have dropped dramatically due to deregulation of the transportation industry.Inventory control analysts have developed a number of techniques which can help small businesses control inventory effectively. The most basic is the Economic Order Quantity (EOQ) model. This involves a trade-off between the two fundamental components of an inventory control cost inventory-carrying cost (which increases with the addition of more inventory), and order-processing cost (which decreases as the quantity order increases). These two cost items are traded off in determining the optimum warehouse inventory quantity to maintain for each product. The EOQ point is the one at which total cost is decrease. By maintaining product inventories as close to the EOQ point as possible, small business owners can minimize their inventory costs.ORDER PROCESSINGThe small business owner is concerned with order processingnother physical distribution functionecause it count only affects the ability to meet the customer service standards defined by the owner. If the order processing system is efficient, the owner can avoid the costs of premium transportation or high inventory levels. Order processing varies by industry, but often consists of four major activities a credit check recording of the sale, such as crediting a sales representatives commission account devising the appropriate accounting entries and military point the item, shipping, and ad experting i nventory records.Technological innovations, such as increased use of the oecumenical ware Code, are contributing to greater efficiency in order processing. Bar code systems give small businesses the ability to route customer orders efficiently and reduce the need for manual handling. The coded information includes all the data necessary to generate customer invoices, thus eliminating the need for repeated keypunching. other technological innovation affecting order processing is Electronic info Interchange. EDI allows computers at two dissimilar locations to exchange business documents in machine-readable format, employing strictly-defined industry standards. Purchase orders, invoices, remittance slips, and the like are exchanged electronically, thereby eliminating duplicate of data entry, dramatic reductions in data entry errors, and increased speed in procurement cycles.PROTECTIVE PACKAGING AND MATERIALS HANDLINGAnother important component of a small business physical distrib ution system is material handling. This comprises all of the activities associated with moving products within a production facility, warehouse, and transportation terminals. One important innovation is known as unitizingombining as many packages as possible into one load, preferably on a pallet. Unitizing is accomplished with steel bands or shrink wrapping to hold the unit in place. Advantages of this material handling methodology include reduced labor, rapid movement, and minimized damage and pilferage.A second innovation is containerizationhe combining of several unitized oodles into one box. Containers that are presented in this manner are often set down in fewer than 24 hours, whereas the task could otherwise take age or weeks. This speed allows small export businesses adequate delivery schedules in competitive international markets. In-transit damage is also reduced because individual packages are not handled en route to the purchaser.FURTHER READINGArtman Les. Clancy, Dav id. dissemination Follows Consumer Movement.Transportation and dispersal.June 1990.Bowersox, Donald, et al. How Supply Chain Competency Leads to Business Success.Supply Chain Management. phratry 2000.Brenner, Gary, Joel Ewan, and Henry Custer.The Complete Handbook for the Entrepreneur.Englewood Cliffs, NJ Prentice Hall, 1990.Evans, James. produceion and operations Management Quality, Performance, and Value.West Publishing Company, 1997.Schmenner, Roger.Production and operations Management From the at bottom Out.Macmillan, 1993.Supply Chain, distribution, and Fulfillment.International Journal of Retail and Distribution Management.October 2000.Wood, Donald, and James Johnson. present-day(a) Logistics.Prentice Hall, 1996.SEE ALSODistribution ChannelsTransportation outsetEncyclopedia of Small Business, 2002 Gale Cengage. All Rights Reserved.Full copy unspoilt. importance of physical distributionbyADMINonMARCH 28, 2007Physical distribution / trade logistics form a pivotal part of th e marketing task. It is physical distribution that confers place-utility and time-utility to a product by qualification it available to the user at the expert place and at the right time thereby it maximizes the chance to sell the product and strengthen the follows competitive position.If any product made in any place could be consumed in its entirely at the very place of production and at the very time of production, there would be no need for physical distribution of that product. But such products are very rare. In practice, almost every product gets consumed at places and times that are different fro those of their manufacture. They have to be carried to places of consumption they have to be stored and they have to be distributed.Where Production Locations and Markets are distanced, Physical Distribution becomes more crucial. In some outcomes, production locations are totally dictated by considerations like proximity to sources of raw material. As a result, the points of pro duction might be far away from the markets for the product. In some cases, huge production capacities get established at a given location on consideration of technology and economies of scale. In all such cases, the product has to be marketed over an extended territory it has to be transported over long distances, stored for a considerable length of time and sold.There are products, which are impacted by the seasonality factor- either production is constant but demand is seasonal, or demand is continuous but production is seasonal. Here too, physical distribution becomes particularly crucial. It has to perform the balancing act between production and consumption.Helps Build ClienteleIt is physical distribution that determines the customer service level to a large extent. As a result, it serves as a vital tool in building clientele / market for the product. And conversely, ineffective physical distribution leads to loss of customers and markets.A Promising orbit for Cost ReductionP hysical distribution is a fertile area for cost savings. Over the years, in most businesses, physical distribution costs have grown into a sizeable chunk of the total costs and now ranks second among all cost elements, next only to material costs. And surprisingly, it has remained one of the neglected areas of cost control.The Dark ContinentPeter Drucker has justly compared physical distribution to the dark continent of Africa of napoleons days. He said, we know nearly physical distribution today just as much as what Napoleons contemporaries knew about the interior of Africa. We know it is there and we know it is big and thats all. The message is obvious. Physical distribution is the most promising area for cost control.more athttp//www.citeman.com/1665-importance-of-physical-distribution.htmlixzz258EK3EJOWarehousingWarehousing Warehousing is the second major component of physical distribution. Warehousing instruction has two distinct and every bit important part 1. The physical job of creating and running the network of storage points and 2. The managerial task of controlling inventory levels without sacrificing service levels. Role and Importance of Warehousing Points below explain the role and importance of warehousing. Like transportation warehousing too vests the product with time utility and place uti expression On CiteMan.comInventory counselling some crucial factorsInventory perplexity some crucial factors Inventory management is the third major component of physical distribution task. It will be obvious that without effective management of finished product inventory it is impossible to run any business efficiently and profitably. Inventory is Inescapable Carrying inventories is inescapable in most business. This is because the producing and overwhelming activities take place at different times in different locations and at different rates. Inventories are hold On CiteMan.com sales publicity budgetSales promotion budget 1. behave Fixed and var iable quantity Costs The direct fixed costs are costs of physically distributing samples placing advertisements and point of purchase material etc. Variable costs are payment made to the retailer for each coupon redeemed. 2. Likely market response The marketer it is suggested should analyze six types of market responses. These are a Redemption rates b Displacement rates c achievement rates d Stock up rates e metempsychosis rates f Product line effects LeArticle On CiteMan.comImportance of physical distributionImportance of physical distribution Physical distribution / marketing logistics form a pivotal part of the marketing task. It is physical distribution that confers placeutility and timeutility to a product by making it available to the user at the right place and at the right time thereby it maximizes the chance to sell the product and strengthen the companys competitive position. If any product made in any place could be consumed in its entirely at the very place of producti on and at the Article On CiteMan.comTransportationTransportation The importance of transportation in physical distribution emanates from a change of factors. Transportation confers time utility and place utility to the product it determines the companys customer service it also has a crucial drift on the other elements of physical distribution and marketing like warehousing inventory control and channel management. Finally transportation is a very important cost element in most businesses. Assessment of the Transportation ReArticle On CiteMan.comOutsourcing marketing logisticsOutsourcing marketing logistics In recent times firms have been taking to non conventional approaches in the matter of physical distribution / management of marketing logistics. Complete outsourcing of marketing logistics is mayhap is perhaps the most noteworthy of them all. Globally outsourcing of physical distribution and channel services has become the inthing in recent years. Firms strike arrangement with external logistics service providers and allow them to function as their extended arm Article On CiteMan.com patterning a marketing logistics systemDesigning a marketing logistics system The Steps involved in designing a physical distribution system as shown below. The first step distribution objectives of the firm must be properly articulated and the minimum service level to be guaranteed in delivery must be clearly specified. In fact the guaranteed minimum service level in delivery is the key to a physical distribution system. It is also the touchstone for measuring the efficiency of the system. Component Functions of Physical DistributioArticle On CiteMan.comMaterials Management An integrated ViewHYPERLINK http//www.citeman.com/index.php?p=4546Materials Management An integrated View The various components of the management of materials were discussed such as 1. Purchasing 2. Inventory Control 3. Storage and materials handling 4. Physical Distribution of materials Each of these is equally important and although some division of responsibility and potence is necessary for dealing with them we cannot treat them as isolated water skinny compartments. The decisions taken by a purchasing executive will have to be tempered or modified by Article On CiteMan.comMarketing logisticsMarketing logistics Physical distribution / Marketing Logistics Physical distribution is the process of delivering the product to the marketing channels and consumers. It encompasses the various activities involved in the physical flow of the product from the producer to the consumer. Marketing logistics is somewhat bigger in scope compared to physical distribution. It covers physical distribution plus a part of the task of marketing channels. While physical distribution takes cope of functions Article On CiteMan.comPhysical distribution marketing logistics needs a system approachPhysical distribution marketing logistics needs a system approach As the functions are interdependent the c ost there of are also closely interrelated. Very often one function subsidies another For example if the firm is prepared to incur increased costs on transportation it may be in a position reduce its warehousing/inventory cost. This is because in such a case the firm can use the fastest mode of transport and rush the stocks to the desired warehouse unmindful of the transportation cost. ObvArticle On CiteMan.comPhysical Distribution Management (PDM)HYPERLINK http//www.citeman.com/index.php?p=4530Physical Distribution Management PDM A customer is served by 1 identifying an existing or potential need of the customer giving concrete expression and shape to the need through advertising designing the product and pricing it 2 manufacturing the product and 3 making the product available to the customer at the right place and time by a proper arrangement of the movements and local storages of the product. Physical Distribution Management function also called Logistics is concerned with item. Article On CiteMan.comLinear ProgrammingHYPERLINK http//www.citeman.com/index.php?p=4833Linear Programming Linear Programming is an Operations Research technique which originated during the early 1950s. Having diverse practical applications this technique has benefited immensely various organizations in their production and other operations. Prof. G B Dantzig is one of the pioneers in formulating the procedure of linear Programming. This technique can be employ in various situations long range readiness production planning warehousing decisions physical distribution marketing and Article On CiteMan.com supposition behind physical distributionHYPERLINK http//www.citeman.com/index.php?p=10700Concept behind physical distribution The concept behind physical distribution is the achievement of the optimum lowest system cost consistent with customer service objectives of the firm. If the activities in the physical distribution system are viewed separately without consideration of their i nterdependence the final cost of distribution may be higher than the lowest possible cost optimum cost and the quality of service may be adversely affected. Additional variables and costs that are interdeArticle On CiteMan.comWhat is physical distribution in marketing?Physical distribution is the set of activities concerned with efficient movement of finished goods from the end of the production operation to the consumer. Physical distribution takes place within numerous wholesaling and retailing distribution channels, and includes such important decision areas as customer service, inventory control, materials handling, protective packaging, order procession, transportation, warehouse site selection, and warehousing. Physical distribution is part of a larger process called distribution, which includes wholesale and retail marketing, as well the physical movement of products.Read morehttp//wiki.answers.com/Q/What_is_physical_distribution_in_marketingixzz258KzBFH3What is the Physical Distribution of Market?Physical Distribution focuses on an efficient movement of manufacturer to intermediaries and the consumer .channel and physical distribution decisions are interrelated but channel decisions tend to be made earlier. The aim is to provide intermediaries and customers with the right products, in the rights quantities, in the right locations, t the right time. Effectives physical distribution save the cost and improve customer service levels. Cost saving can be achieved by reducing inventory levels , using cheaper forms of transport and shipping in bluk.Customer service levels can be improved by fast and reliable delivery ,holding high inventory so that a customer have a wide superior and the chance of stock out are reduced , fast order processing and ensuring product arrive in the quantities and quality .Physical distribution management concern the balance between cost reduction and meeting customer service requirement . Trade offs are often necessary, for insta nce, low inventory and slow, cheaper transportation method reduce the cost but lower customer services levels and satisfaction as well . Determining this balance is a key marketing decision as physical distribution can be a source of competitive advantage .Distribution (business)From Wikipedia, the desolate encyclopediaMarketingKey conceptsProduct marketingPricingDistributionServiceRetailBrand managementAccount-based marketingEthics dominanceResearchSegmentationStrategyActivationManagementDominanceMarketing operationsPromotional contentsAdvertisingBrandingUnderwriting spot now marketingPersonal salesProduct placementPublicitySales promotionSex in advertisingLoyalty marketing busy marketingPremiumsPrizesPromotional mediaPrintingPublicationBroadcastingOut-of-home advertising internetPoint of saleMerchandiseDigital marketingIn-game advertisingProduct demonstrationWord-of-mouthBrand ambassadorDrip marketingoptical merchandisingvteWikibooks has a book on the topic ofMarketingDistributio n channel redirects here. So does Channel (marketing).Product distribution(orplace) is one of the four elements of themarketing mix. Distribution is the process of making a product or service available for use or consumption by a consumer or business user, using direct means, or using indirect means withintermediaries.The other three parts of themarketing mixareproduct,pricing, andpromotion.Distribution is one of the classic 4 Ps of marketing (product, promotion, price, place a.k.a. distribution). Its a key element in your entire marketing strategy it helps you expand your reach and grow revenue.B2B and B2C companies can sell through a single channel or through multiple channels that may includeWholesaler/Distributor Direct/Internet Direct/Catalog Direct/Sales Team Value-Added Reseller (VAR) advisor Dealer Retail Sales Agent/Manufacturers RepContentshide1HYPERLINK Channels_and_IntermediariesHYPERLINK Channels_and_IntermediariesChannels and Intermediaries2HYPERLINK Channel_DesignHYP ERLINK Channel_DesignChannel Design3HYPERLINK Distribution_TypesHYPERLINK Distribution_TypesDistribution Types4HYPERLINK Channel_MixHYPERLINK Channel_MixChannel Mix5HYPERLINK Managing_ChannelsHYPERLINK Managing_ChannelsManaging Channels5.1HYPERLINK Channel_MotivationHYPERLINK Channel_MotivationChannel Motivation5.2HYPERLINK Channel_ConflictHYPERLINK Channel_ConflictChannel Conflict6HYPERLINK See_alsoHYPERLINK See_alsoSee also7HYPERLINK ReferencesHYPERLINK ReferencesReferences8HYPERLINK Lin