Marketing Mix

PLACEThis is also called ‘Distribution’.

A business must get the product to the right place, at the right time in a way that is most convenient to customers.

PLACE

A product which is effectively priced and promoted may not be successful unless the consumer is able to purchase it easily.

Distribution Chain/ Channel

The link between producer and customer using two intermediaries – wholesaler and retailer.

PricemartNestle,

Kiss Baking Co.

Supermarket

StoreYou and Me

A two-intermediary channel

A one-intermediary channel

A business that holds stock by buying from manufacturers in large quantities, breaking the bulk and selling in smaller quantities to

retailers

Wholesalers

Reduced transport costs

Cost of holding stock now paid for by the wholesaler

Wholesaler sells products in smaller quantities

Benefits to the manufacturer of using wholesalers

Offers a large range of products from different manufacturers

Will often supply in small quantities and deliver to retailers

Prepares and pre-packs goods ready to be put straight onto retailers’ shelves

Benefits to the retailer of using wholesalers

A business buys products in large quantities from producers or wholesalers and sells to

customers in small quantities

Retailers

They make good and services available to customers in the quantities that they want

They are often located in areas convenient for customers

They provide advice and after-sales service to consumers

They provide outlets for manufacturers’ products

They provide useful information gained from consumers about products and give feedback to wholesalers or manufacturers

Functions of Retailers

Types of Retailers

Door-to-door

These salespeople deal in relatively minor goods. They either walk from door to door or

use some form of transportation.

Market traders

These operate from stalls in open or covered areas. Prices are low because they avoid

expenses such as electricity and high rent

Shops

These are small and may be owned by sole traders. They provide personal attention and

customers are familiar with owners and employees

Multiples or Chain Stores

These are owned by one company. They are controlled from a central headquarters and are located across a country or region. One

advertisement can cover all branches.

Supermarkets

This is a large self-service store where customers can purchase food and household

items.

Department Stores

This is a large shop that is divided into departments which each operate like a single

shop, that is, they are responsible for their own profitability

Vending Machines

These are open 24 hours a day and are situated in public areas like hospitals and universities. They have a variety of snacks

and drinks.

Catalogue Shops

A catalogue shop publishes a detailed catalogue with all the products for sale. If

customers are interested in the product they can purchase through a shop or order and

have the item delivered.

Online shopping

This involves buying items from a company’s website using a credit card. The item is

delivered to the customer at a later date.