Chapter 4

Download as docx, pdf, or txt
Download as docx, pdf, or txt
You are on page 1of 4

A distributor has heard that one of the major manufacturers from which it buys is

considering going direct to the consumer. What can the distributor do about this?
What advantages can it offer the manufacturer that the manufacturer is unlikely to
be able to reproduce?
Use manufacturer storage with direct shipping design. It offers manufacturers
opportunity to postpone customization until after the customer order is placed
A distributor has heard that one of the major manufacturers from which it buys is
considering going direct to the consumer. What can the distributor do about this?
What advantages can it offer the manufacturer that the manufacturer is unlikely to
be able to reproduce?
Use manufacturer storage with direct shipping design. It offers manufacturers
opportunity to postpone customization until after the customer order is placed
A distributor has heard that one of the major manufacturers from which it buys is
considering going direct to the consumer. What can the distributor do about this?
What advantages can it offer the manufacturer that the manufacturer is unlikely to
be able to reproduce?
Use manufacturer storage with direct shipping design. It offers manufacturers
opportunity to postpone customization until after the customer order is placed
Chapter 4
 A Distributer has heard that one of the major manufacturers from which it buys is
considering going direct to the consumer. What can the distributer go about this? What
advantages can it offer the manufacturer that the manufacturer is unlikely to be able to
reproduce?
Use manufacturer storage with direct shipping design. It offers manufacturers opportunity to
postpone customization until after the customer order is placed.
The distribution management process has a direct impact on profits gain. Thus, a distributor
model is considered a prime channel in the supply chain network. Therefore, the distributor
model shows its benefits to the supply chain management that the manufacturer model cannot
offer. These benefits are its supply chain network design: distributor storage with package carrier
delivery and distributor storage with delivery. The distributor storage with package carrier
delivery and distributor storage with delivery proposals offer higher orders visibility for the
customer and are accessible to customers’ reach. Distributor models are also efficient in terms of
time delivery; for the manufactures model, direct to the client will be slow since they have bulk
inventory; thus, it will take time to single out one less bulk order the consumer. In addition to
this distributor model also has customer experience as opposed to the
manufacturers’ model. On the other hand, the distributor's network has some consideration to
the customer’s
perspectives when handling orders. Firstly, we have the ability of the distributors to offer a
greater level of flexibility than manufacturers, which includes timely delivery (Dwaikat, Money,
Behashti, & Salehi-Sangari, 2018). Another beneficial consideration of distributor models in
supply chain management is the ability of the distributor to offer product bundling. This aspect
encourages the consumer to buy more goods. It also reduces the administrative and freight costs
which could have been incurred when selling a single commodity.
models should consider the distributor’s control model to cover the company’s freight expenses.
The distributor model is also known to establish strong relations with local carriers, innovative
consolidation and the use of third-party logistics providers. Another benefit of the distribution
model is financial considerations. Distributors are flexible in allowing payment extension terms
to their customers and consignment programs with the third party. In this case, it also acts as a
way of building trust between the distributor and the seller. It is also a way of doing business
with low commissions that will benefit the distributor, thus more profits to the company. On the
other hand, manufacturers going direct to consumers often allow extension of payment terms and
do not offer consignment programs. For instance, international suppliers ask for payments before
shipment is on board in most cases. Thus distributors are said to be more flexible to implement
more programs that bring greater value to customers.

 What type of distribution network is typically best suited for sales for commodity items
Commodity items are non-differentiated products with wider availability from multiple sources.
The most important thing for the distribution network of commodity items is to deliver them
quickly as they are mostly basic needs satisfying products. If there is lack of responsiveness in
the delivery, the customer will switch to another source. Based on the above stated facts, the
distribution network suited for commodity items is the retail storage with customer accessing it
easily or the storage distribution with last-mile delivery...

 what are the major advantages of using the drop-shipping distribution network

Dropshipping offers some significant advantages to ecommerce merchants:


Lower startup costs: Businesses that adopt a dropshipping strategy don’t have to invest capital
in acquiring inventory or establishing a location to store it. They also don’t have to spend time
organizing their inventory or hiring a staff to fulfill orders. This means that dropshipping has a
very low barrier to entry, as you can start a dropshipping business when you don’t have the funds
necessary to run a traditional retailing operation.
Scalability: A dropshipping retailer can scale quickly because order fulfillment is not dependent
on the size of a physical location or the number of workers needed to ship out an order. For this
reason, dropshipping can greatly benefit retailers that experience fluctuating sales due to
seasonal factors or other reasons.
Lower inventory management: By eliminating the need to maintain physical inventory,
dropshipping reduces the management overhead retailers that face. They do not need to spend
time tracking inventory, managing the infrastructure that houses it, or managing shipping, which
is outsourced to suppliers.
Broad product offerings: Dropshipping opens up more product opportunities. Retailers can
offer a wider range of products, meaning a small business that would otherwise not be able to
offer so many options without storage can sell a broad selection.
Flexibility: Dropshipping brings flexibility to many facets of a retail business. A brand can
operate from anywhere, offer different types of products, and change its offerings easily if
market preferences change.

. Amazon.com sells books, music, electronics, software, toys, and home


improvement products online. In which product category does going online offer
the greatest advantage compared with a retail store chain? In which product
category does the online channel offer the smallest advantage (or a potential cost
disadvantage) compared with a retail store chain? Why?
- Online: books, music, electronics & software.
- Store: toys & home improvement products.
Although all are depending on the need of the customer.
. Amazon.com sells books, music, electronics, software, toys, and home
improvement products online. In which product category does going online offer
the greatest advantage compared with a retail store chain? In which product
category does the online channel offer the smallest advantage (or a potential cost
disadvantage) compared with a retail store chain? Why?
- Online: books, music, electronics & software.
- Store: toys & home improvement products.
Although all are depending on the need of the customer.
. Amazon.com sells books, music, electronics, software, toys, and home
improvement products online. In which product category does going online offer
the greatest advantage compared with a retail store chain? In which product
category does the online channel offer the smallest advantage (or a potential cost
disadvantage) compared with a retail store chain? Why?
- Online: books, music, electronics & software.
- Store: toys & home improvement products.
Although all are depending on the need of the customer.
. Amazon.com sells books, music, electronics, software, toys, and home
improvement products online. In which product category does going online offer
the greatest advantage compared with a retail store chain? In which product
category does the online channel offer the smallest advantage (or a potential cost
disadvantage) compared with a retail store chain? Why?
- Online: books, music, electronics & software.
- Store: toys & home improvement products.
Although all are depending on the need of the customer.
. Amazon.com sells books, music, electronics, software, toys, and home
improvement products online. In which product category does going online offer
the greatest advantage compared with a retail store chain? In which product
category does the online channel offer the smallest advantage (or a potential cost
disadvantage) compared with a retail store chain? Why?
- Online: books, music, electronics & software.
- Store: toys & home improvement products.
Although all are depending on the need of the customer.
 DO you think distributor storage with last-mile delivery is good for the automotive spare
parts industry? Why?
Last-mile delivery refers to the distributor/retailer delivering the product to the customers home
instead of using a package carrier. The automotive spare parts industry is one in which
distributor storage with last-mile delivery is the dominant model. It is too expensive for dealers
to carry all spare parts in inventory. Thus, original equipment manufacturers tend to carry most
spare parts at local distribution centers typically located no more than a couple of hours drive
from their dealers and often managed by a third party.
Transportation cost of LMD is best justified in settings where the customer is purchasing in large
quantities. This is rare for individual customers, but businesses such as auto dealerships purchase
large quantities of spare parts on a daily basis and can this justify daily delivery. Home delivery
to individual customers can be justified for bulky items such as 5-gallon jugs of water in the US
or large bags of rice in China. Response times are faster than using package carriers.
 amazon sells books, music, electronics, software, toys and home improvement products
online. in which product category does going online offer the greatest advantage compared
with a retail store chain?
Online: Books musics, electronic & software
Store: Toys & home improvement products
Although all are depending on the need of the customer

You might also like