Introduction:Asmarketerswellknow,distributionisamajorcomponentofthemarketingmix,avitalandnecessarypartoftheso-calledfourPs.AccordingtoPeterDrucker’sview,thedistributionasoneofthe‘finalfrontiers’ofmanagementbecauseitaffectallaspectsofthefirm’slong-termandshort-termactivityandinternalorganization.(AlanWest,1989,P2)Iftheproductisnotaccessible,itmustbedifficulttosellitandthenalltheeffortsmadetopromotetheproductionswillbeinvain.PeterDrucker’svisionofthefutureofmanagementseesfewer,morehighlyskilled,andlessdepartmentalizedindividualsorganizinganddirectingthehightechnologyfirmsintheindustrializedworld.Distributioninvolvesawholerangeofexternalandinternalfactors.Andwewilldiscussthefollowingaspects:Changingdistributionenvironment,componentsofdistribution,keyissuesofdistribution,andthevariousdistributionchanneldesigns.TheChangingDistributionEnvironment:Anycompaniesexistinaneraofacceleratingchangeespeciallytheinternationalfirms.Largenumbersofrelatedenvironmentalchangesrequiresimprovingofdistributionconsistently.Thepressuresexertedbychangeoncompanydistributionpolicyvarywiththecompanybutallcompanieswillsharethecommoneffectsofbroaderenvironmentalconditions.NewtechnologyNewtechnologyishavingadramaticimpactondistribution.Itisastonishingbecauseofcontinuallybeingrefinedandappliedindifferentsituations.Simplybyimprovingknowledgeofsales,volumes,productionleadtimes,currentinventories,manufacturerscanreducestockholdingatplants,controlinventoriesatsuppliersandchangeorderprocessingprocedure.(AlanWest,1989,P6)Emergenceofnewtechnologyleadsmoreeffectivelytransportation,infrastructureandevenproceduremanagement.Therehavebeenalterationsbetweencompaniesaswellaswithinthem.Forexample,theBarcodsystem.Itwasnotuseduntil1970swhichsimplesthecontrolsofpurchasing,producing,warehouse,sale.IndustrialconcentrationInallmajorwesterneconomies,industrialconcentrationortheownershipbyfewerandfewercompaniesoflargerandlargermarketsharesproceedsapace.Thishastwoimportanteffectsonsuppliers.First,theirprofitmarginswillbeputincreasinglyunderpressureaslargegroupsbuyinginlargequantitieswillwantlargediscounts.Forthefastmovingconsumergoodsmanufacturethemarketrealityisthattheyareachievingagreaterandgreatervolumeofsalesthroughasmallernumberofaccounts.Thischangeinfluencesthewaysuppliersorganizeandservicetheirmarkets,withdistributionbecominganincreasinglykeyissueineffectivemarketmanagement.SpeedofmarketchangeThehugegrowthincompetitive,internationalmarketshasplayedakeyroleinshapingthetotaldistributionenvironment.Thusthepaceofproductreplacementhassteadilyincreased.IndeedwhenonecomparesthemarketsofEurope,JapanandtheUS,itispossibletojudgethecompetitivenessoftheenvironmentbythespeedofproductchangeandinnovation.Companiesinhightechnologyandconsumerfashionhavetorespondmorerapidlytochangesinmarkettrendsandcontroltheirlevelsofinventoryandproductrangeaccordingly.IncreasingcostsofpersonnelLabourcostsroseconsistentlyinthiscentury.Forexample,Australianlabourcostchangedfrom14.4to24.6during2001to2005.()Distributionremainsverylabourintensiveformanyfirmsandchangesindistributionpolicyandorganizationoftenhaveasignificantimpactonstaffinglevels.RisingfuelGiventheshortageofcrudeoilresources,fuelcosthascontinuedtoriseinrealtermssincetheearly1970s.IntheApril2010,thepetrolpriceshavereachedanewrecordhigh,havingbrokenthepreviousrecordof119.7palitersetinJuly2...
