Channel members are the participants in the chain from the producer to the consumer. These individuals are essential when it comes to the distribution of goods. They are vital in the following ways: They reduce the cost by specialization. Many members specialize in that they only work on the distribution and nothing else. From this perspective, the individuals and company develop various skills to ensure that their delivery is the most effective and efficient (Cui & Mallucci, 2016). The channel members get this time to plan and improve their services because this is the only task they have at hand. Consequently, the channel members can reduce the time between manufacturing and delivery. Because of their specific methods which are highly improved and efficient, they will provide the shortest means of transport which will ensure the products get to the consumers on time.
The Choice Intermediary
Choosing the right channel is a crucial decision that the manufacturer can make. For the manufacturer to make such a decision, they will have to gauge the intermediary in the following methods: they will consider the time the intermediary has spent in the industry, this alone gives the manufacturer the impression of how much they have learned in the course of working. Besides, understanding the reputation of the intermediary is another vital aspect to consider. By studying the size of the agency, the number of employees they have the manufacturer can know the financial status of the intermediary. Furthermore, the manufacturer should also consider the skill and experience the intermediary possesses. Lastly, an analysis of how well the intermediary understands the market helps the manufacturer know how trusted the channel is (Cui & Mallucci, 2016).
Criteria to Consider When Choosing a Channel Member
For the channel to be successful, the car audio manufacturer must make the right choice of the chain they are delegating their products (Lima-Junior, & Carpinetti, 2016). Having a clear understanding of how much the distributor has about the product market one of the essential things the producer should consider. By knowing the market well, the channel member will be able to understand some of the factors that may affect the sales of a product. By giving the customer the best product in the best way possible, the channel will be in a position to advise the producer on some of the ways to improve the product.
Secondly, the financial power of the distributor is of importance. A company that has the resources to provide a quality distribution will propel the company to reach its heights because it will ensure the products reach the customer without any delay. While the speed of delivery will be higher with adequate resources, it is also more likely that the distributor will reach more customers and hence increase the sales of the product. For a producer to know how powerful the distributor is, they can consider the number of employees that the company has or the size of their firm and other factors such as the size of assets they own.
Moreover, the manufacturer can consider the skills and experience that the distributor has. This characteristic is among the most important because it will determine how effectively the channel member will undertake their activities. Exploring the skills can be done by looking at the type of technology they apply while working. This will give the manufacturer the impression of how efficient they do the work. Also, it is important to check on the reputation of the channel member. This reputation plays an important role because the impact the member has on the market will be automatically connected to the producer. Understanding their reputation will also help the producer know the amount of risk they are taking in choosing the distributor.
To sum up, the manufacturer must consider the amount of time the channel has spent in the market. Understanding market dynamics requires time. This means that the more an individual operates in the market, the more they will learn about how to relate with customers. However, this aspect should not be mistaken as the method to judge expertise. There are many members who even though, they have not spent a lot of time in the market, still, understand and can work very well in their task if given the opportunity (Lima-Junior, & Carpinetti, 2016).
Lima-Junior, F. R., & Carpinetti, L. C. R. (2016). A multicriteria approach based on fuzzy QFD for choosing criteria for supplier selection. Computers & Industrial Engineering, 101, 269-285.
Cui, T. H., & Mallucci, P. (2016). Fairness ideals in distribution channels. Journal of Marketing Research, 53(6), 969-987.
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