TABLE OF CONTENTS

MODULE 2 and 3 (Distribution Management)

Lesson Nos. Topics Time Frame Pages
I. CHANNEL MANAGEMENT & CONFLICT February 22, 24 and
1 26, 2021
 Channel Management
 Channel Power (3 Hours)
 Types of Channel Power
 Channel Conflict March 1, 3, and 5,
 Types of Channel Conflict 2021 2-4

(3 Hours)
March 8, 10 and 12,
2021

(3 Hours)
March 15, 17 and 19,
2 II. MARKET LOGISTICS AND SUPPLY 2021
CHAIN MANAGEMENT
 Scope of Logistics (3 Hours)
 Extension into supply chain management 5-7
 Logistics and other function March 22 and 24,
 Inventory management 2021
 Warehouse
(2 Hours)

3 III. DIFFERENCE BETWEEN LOGISTICS AND April 5, 7 and 12,

SUPPLY CHAIN MANAGEMENT 2021

(3 Hours)
April 14, 16, 19 and 8
21, 2021

(4 Hours)
4 IV. INTERNATIONAL DISTRIBUTION April 23, 26, 28 and
STRATEGY 30, 2021

(4 Hours)
9-11
May 3, 5, 7 and 10,
2021

(4 Hours)

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 COLLEGE OF BUSINESS MANAGEMENT
LEARNING MODULES in DISTRIBUTION MANAGEMENT (MM 117)

MODULE 2 & 3. MIDTERM & FINAL COVERAGE

Learning Outcomes:
 Demonstrated the proper ways and procedure in handling channel Conflict.
 Discussed the scope of logistics.
 Explained the functions of logistics.
 Described how distribution is done in the international markets.
 Appreciated the primary differences between logistics and supply chain management.
 Discussed the individual processes of supply chain management.

LESSON 1. CHANNEL MANAGEMENT AND CONFLICT

Channel management is a marketing management activity that involves handling the different streams
employed by a company to sell its products or services. It can be defined as the set of strategies utilized by a
company to administrate its different distribution channels.

Channels are different branches used by companies to take its products to the public market. On the other
hand, from and advertising perspective, channels are also the different means employed to communicate a
given marketing campaign, as is the case for newspapers, TV, digital media, and social networks, among
others. From a product distribution angle, the company can administrate how its products and services reach
its target customers by establishing alliances and partnerships with different other companies or individuals.
The most common channels are agents, wholesalers, and retailers. Companies can classify its distribution
process depending on how many players are between the manufacturer and the consumer. These different
stages are called levels.

Vertical integration. Generically speaking, products may come and reach consumers through a chain
somewhat like this: (refer to previous handout)

Raw materials ---> component parts ---> product manufacturing---> product/brand marketing
---> wholesaler ---> retailer---> consumer

Money can be made at each stage in the chain, and it may be tempting for firms to try to get into all aspects.
For example, Henry Ford wanted to make all the components for his own cars, so Ford tried to run its own
rubber plantation with limited success. The temptation to try to expand vertically can be especially strong
when an industry faces limited growth and thus presents limited opportunities for reinvestment into traditional
operations (e.g., if the auto industry is not growing as much as desired, one way to reinvest profits, rather
than having to pay them back to stockholders who would then have to pay taxes on the dividends, might be to
buy steel mills. The problems, however, is that the management is not used to running such businesses and
that managerial time will be spread among more areas.

Business structures. A business can be squarely focused in just one area—e.g., Kentucky Fried Chicken is
only in the fast-food business and prides itself on this. On the other hand, certain businesses are part of an
assortment of businesses that all have common, or at least overlapping, membership. Sometimes, these
businesses can be related in some way—for example, Pepsico used to own several restaurant fast food chains,
and Microsoft, in addition to being in the software business, used to own Expedia, the online travel service.
Here, expertise and brand equity might be transferred from businesses to business. In other situations,
however, these "empires" may consist of unrelated businesses that were bought not so much because they
"fit" into management expertise, but rather because they were for sale when the conglomerate had money to
invest. With the tobacco industry currently being relatively profitable but having a questionable future, a
tobacco firm might invest in a software maker. Generally, such investments are risky because of problems with
management oversight. In Japan, many firms are part of a keiretsu,  or a conglomerate that ties together
businesses that can aid each other. For example, a keiretsu might contain an auto division that buys from a
steel division. Both of these might then buy from a iron mining division, which in turns buys from a chemical
division that also sells to an agricultural division. The agricultural division then sells to the restaurant division,
and an electronics division sells to all others, including the auto division. Since the steel division may not have
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opportunities for reinvestment, it puts its profits in a bank in the center, which in turns lends it out to the
electronics division that is experiencing rapid growth. This practice insulates the businesses to some extent
against the business cycle, guaranteeing an outlet for at least some product in bad times, but this structure
has caused problems in Japan as it has failed to "root out" inefficient keiretsu members which have not had to
"shape up" to the rigors of the market.

Motivations for outsourcing. While firms, as discussed above, often have certain motivations for trying to
"gobble" up as many business opportunities as possible, there are also reasons for "outsourcing" or
contracting out certain functions to others. Auto makers, for example, have often found it profitable to buy
several components from non-union manufacturers. Often small vendors, run by entrepreneurs, are
better motivated to perform certain services—e.g., insurance agents can have an incentive to build up and
service a client base more effectively than an internal staff could. It is also possible for outsiders to  specialize
—chemical firms, for example, may be better able to research and develop paints than auto manufacturers.
Smaller independent firms may also operate more leanly, facing market competition better than large,
centralized firms. A firm specializing in just making nuts and bolts may have greater economies of scale than
Rolls Royce, which makes only a limited number of cars.

Channel Power. Channel power is when one member of the channel attempts to guide and support
members of the other channel. The channel member that assumes this position is known as the channel
captain. Channel power occurs in four different ways, economic power, expertise, identification, and legitimate
right.

3 TYPES OF CHANNEL POWER

1. When a channel power arises through economic power this typically means that the company has
the power to reward the other by some means due to its’ financial situation.
2. Next, a channel power occurs when one company has certain expertise and acts as a helping hand
for another. For the company to help, they are granted some power over the other. Channel power can
also arise through identification of a brand through other well- known and well-received [by
customers] channels. “For example, retailers may compete to carry Ralph Lauren, or clothing
manufacturers may compete to be displayed by Neiman-Marcus or Nordstrom” (Kerin and Peterson
362).
3. Lastly, there is channel power through legitimate right. This kind of channel power typically involves
a contractual agreement of some sort. This form of channel power is seen in franchises. Franchises’ will
operate under terms defined by the franchise. Ultimately, making the franchise the channel power with
a legitimate right.

Some channel members need others more than others need them. For example, Wal-Mart has a lot more
power, given its large volume purchases, than many of its suppliers. There are several sources of
power. Reward power involves a channel member being able to positively reinforce another’s performance—
e.g., Coca Cola may be able to give a price break or pay a fee for additional shelf space. A retailer that meets
a certain goal—e.g., the sale of 50,000 cases per month—may receive a bonus. In contrast, coercive power
involves the threat of a punishment. A large retailer, for example, may tell a small manufacturer that no
further orders will be forthcoming unless a price discount is offered. Expert power includes knowledge. Wal-
Mart, for example, because of its heavy investment in information technology, can persuasively argue about
likely sales volumes at different price levels. "Legitimate" power involves government or other regulations—
e.g., auto dealers have a great deal of power over auto makers because only they can sell to end customers in
the continental U.S. under most circumstances. Finally, referent power involves the desire of the other side
to be associated—most manufacturers of upscale merchandise are highly motivated to ensure their availability
at Nordstrom’s.

Channel conflict. We have seen throughout the term that conflict exists between channel members.
Channel conflict occurs when a member of one channel believes that another channel is acting in a way that
interferes with the channel’s projections and goals for the quarter or any period. Channel conflict can arise
through four different ways.

4 TYPES OF CHANNEL CONFLICT

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 1. Channel conflict can occur when a channel member decides to buy or sell direct rather than
go to the manufacturer’s agents. This can be seen in the case when Wal-Mart decided to purchase
products directly from manufacturers rather than the manufacturer’s agents.
2. The second cause of channel conflict occurs when one channel member has demands that might
prevent a business from meeting their profit margin goals. For example, let us say you
manufacture planes and you are demanding lower prices from the company that makes the engines.
They may not renew the contract since you are stopping them from reaching their profit margin goals.
3. Another reason for channel conflict to occur is when a company feels that one of the channels is
not giving their product the proper attention. For example, Nike stopped shipping popular
sneakers such as Nike Shox NZ to Foot Locker in retaliation for the retailer’s decision to give more shelf
space to shoes costing under $120 (Kerin and Peterson 362).
4. The fourth and last reason that causes channel conflict happens “when a manufacturer engages in
dual distribution and particularly when different retailers or dealers carry the same
brands” (Kerin and Peterson 362). This example can be seen through Shaw Industries’ decision to
create its own in-store locations. This caused a conflict between them and their retailers' customers like
Home Depot, who decided to drop Shaw Industries in light of this situation.

For example, Coca Cola would like to increase its sales by offering a discount on its cans. However, the retailer
knows that overall soda sales will not go up much when Coke is put on sale—consumers who bought other
brands will just switch, for the most part. Therefore, the retailer might like to "pocket" any discount that Coke
offers. Similarly, Bass might like to increase its sales by selling to Costco, but its full-service retailers will object
to this competition. Several approaches to resolution are available, but none are perfect. Sharing of
information may help build trust, but this can be expensive, cumbersome, and may result in this information
being available to competitors. The two sides might seek outside mediation, with a supposedly neutral party
suggesting a fair solution, or the two sides may try to compromise on their own. One side may accommodate
the other but may not be motivated to continue to do so in the future, or the other may try to coerce its way
through threats of punishment.

So, understanding the different types of channel power and channel conflict can help you understand your
current position in current business relationships as well as how to avoid channel conflicts.

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 LESSON 2: MARKETING LOGISTICS AND SUPPLY CHAIN MANAGEMENT

Because of globalization, finding a suitable marketplace is so difficult. In this marketplace, selling a product is
very easy then to find its target customers. That is why, every company must select the best way to store,
handle, moves their product so that they reach their respective customer with a right assortment of product,
at the right time, at the right place.

If a company can manage its logistics effectiveness, these companies have a competitive advantage on both
customer satisfaction & company cost. The following are several factors that need to consider.

 Nature & importance of logistics management in the supply chain

 Goals of the logistics system
 Major logistics functions
 The need for integrated supply chain management

Nature & Importance of Logistics Management in the Supply Chain

Typically, some managers think marketing logistics means only trucks & warehouses. But in the present time,
logistics is much more than previous. Marketing logistics also are known as physical distribution. It involves:
 Planning
 Implementing
 Controlling the physical flow of goods
 Related information from points of origin to point of consumption
 To meet customer requirements at a profit

Shortly, it is mainly getting the right product to the right customer in the right place at the right time. In the
past time, physical distribution was related to producing product & get its customers at a lower cost. But in the
present time, marketing logistics is based on customer centered. Marketing logistics involves both
inbound & outbound & reverse logistics. The total process of this is called supply chain
management.

Supply chain management is a process of managing upstream & downstream value-added flow of materials.  
It also supplies related information among suppliers, the company, resellers & final consumers.

Supply Chain Management is the process of managing the movement of the raw materials and parts from
the beginning of production through delivery to the consumer. In many organizations, operational supply chain
decisions are made hundreds of times each day affecting how products are developed, manufactured, moved,
and sold. 

See the below figure:

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Above figure shows that managers need to coordinate the activities of suppliers, marketers, channel members,
purchasing agents, production planning, order taking, inventory management, warehousing & transportation
planning.

Inbound Logistics. A manager in charge of inbound logistics manages everything related to the incoming
flow of resources that the company needs to produce its goods or services. These activities will include
managing supplier relationships, accessing raw materials, negotiating materials pricing, and arranging quicker
delivery.

Outbound Logistics. A manager working in outbound logistics will be focused on two issues: storage and
transportation. He or she will use warehousing techniques to keep the finished goods safe and accessible.
Since the products may need to be moved out to a customer at any moment, proper organization is crucial.
Having as little product stored as possible can be advantageous since stored products are not making money,
so the outbound logistics manager often must balance company cost savings with consumer demand. The
transportation function is by far the most complex part of outbound logistics. Without transport, there simply
is no logistics. For that reason, it is critical to be able to move the product from one location to another in the
fastest, most cost-effective, and efficient way possible. Since transportation involves  fluctuations, factors such
as delays and changes in fuel costs need to be considered to cover all possible scenarios that might jeopardize
the efficient movement of goods.

There are several reasons for the emphasis on marketing logistics. They are:
 Get a competitive advantage
 Tremendous cost saving both customers & company
 Variety of product create the need for customers
 Logistics affects the environment & its sustainability

Let us see an example of environmental sustainability.

We all know the brand-named SC Johnson. At present, they change their packaging system. The
reason behind this is – in the old packaging system, their trucks get filled before reaching its maximum
weight limit. To solve this problem, they develop a strategy for mixing up two different product
packages at once. Through this, they can send more product than before & it also helps to reduce their
more shipment. Now, fewer gallons of diesel fuel are needed that eliminate the greenhouse gases. The
manager of SC Johnson says that this strategy not only helped the environment but also saved the
company money.

Goals of the Logistics System. Some companies set their objectives as to serve the customer at their best
but at the least cost. But truly saying, no marketing logistics can both maximize customer satisfaction &
minimize distribution cost. Customer satisfaction only comes through:
 Rapid delivery
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  Flexible assortments
 Liberal returns policy
 Large inventory
 Credit service
 After sell service
 Warranty service
 Packaging & many others

But all of this raises distribution costs. In contrast, if your company wants to reduce its distribution cost, then
slower delivery, smaller inventory, larger shipping which all effect on the customer’s lower satisfaction.

The goal of marketing logistics is to provide a targeted level of customer satisfaction at a lower
cost. The company needs to do research about it & find out the importance of various marketing distribution
services to customers. The main objective is to make profits, not to sales. Some companies provide higher
distribution services & charges higher price.  Some others may provide lower services & lower price.

Major Logistics Functions. Companies always want to reduce its cost. They also want to attain their goals
with lower cost. The major logistics functions are:

1. Warehousing: Production & consumption do not match at the same time. So, companies need to wait
until products are sold. So, they need a store to keep their product safe.

For example, Snapper, Toro, & other lawn mower producers run their business all year long. Their product
buying seasons is summer & spring. So, the producer produces its product & store for selling in the buying
seasons. As like winter clothes producer, produces their product but this product is only sold in winter.  So, all
the year what should they keep their products?  To keep their products, they need a place to store.  This
place is called the warehouse.

2. Inventory Management: Inventory management always affects both customer satisfaction & the
company’s image. Managers need to manage their inventory so effectively. Because carrying too many
inventory & carrying too little both will affect the company’s image. Having too little inventory, the manager
may not provide the needs of the customer when they want to buy. To remedy this problem, the company
needs to costly emergency shipments or production to meet the needs of customers.

3. Transportation: Transportation is the most effective function of logistics. This function affects the pricing
of products, delivery performance, conditions of the goods when they arrive.

All this also affect customer satisfaction. The company mainly chooses five major modes of
transportation.
 Trucks
 Railroads
 Water carriers
 Air carriers
 Internet carriers

4. Logistics Information Management: companies need information to manage their supply chain. In the
logistics perspective, all the information about the customer like billing, shipment, inventory
level, transactions & even customer data is closely related to channel performance. Companies
need accurate information for capturing processing & sharing channel information.

There are many ways like-EDI (electronic data interchange) link, which is mostly used for sharing information.
It is the digital exchange of data between the channel & company. Another way is VMI (vendor management
inventory), which is used for knowing the real-time data on sales & current inventory levels with the supplier.

At present, more & more companies are very conscious of the integrated logistics management concept. This
concept emphasizes teamwork.  This teamwork may be both inside the company & among the marketing
channel members. They mainly do that to maximize the performance of the entire distribution system. Inside
the company, various departments should work closely together to maximize their own logistics performance.

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In the outside of the company, the effective channel members should work their best to maximize the
performance of the entire distribution network.

LESSON 3: DIFFERENCE BETWEEN LOGISTICS AND SUPPLY CHAIN MANAGEMENT

Logistics is a small portion of supply chain management which combines the flow of goods, services,
information, and capital right from raw material to its final consumer. While Supply Chain Management is a
broader term which is associated with the sourcing of raw material, procurement of consumer requirements,
conversion into final products and delivering on time at consumer end (logistics). Due to external constraints,
Innovations and New Technology and Internal Advancements: Supply Chain Management has evolved a san
improvement over Logistics.

Key Differences: Logistics Management (LM) and Supply Chain Management (SCM)

 The basic difference between Logistics and supply chain management is that logistics management is
the process of integration and maintenance (flow and storage) of goods in an organization whereas
supply chain management is the coordination and management (movement) of supply chains of an
organization.
 Logistics Management is customer satisfaction while supply chain management emphasizes more on
competitive advantage.
 Earlier to deliver any goods or services to its final customers only Logistics Management was applied
whereas SCM is an evolved and modern concept of the same.
 LM involves only one organization whereas multiple organizations (coordination and collaboration of
parties like suppliers, intermediaries, distributors, and customers) are involved with SCM.
 LM is a small part of SCM, whereas SCM is a new and modern concept.
 SCM involves planning, implementation, and effective storage of goods and services between the point
of origin and point of consumption to meet customer requirements. Whereas LM’s main objective is to
deliver the right product at the right time with all other attributes in place.
 SCM is a series of interconnected activities related to the movement of raw materials to finish goods
until it reaches the end user. Whereas LM involves activities like warehousing, proper packaging, order
fulfillment, stock control and stock management.
 SCM is a broader term which refers to them connection with the suppliers to the ultimate consumer.
Whereas LM is associated with only maintenance and storage of goods.

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 LESSON 4: International Distribution Strategy

How to compete with your product in the global economy? How can you manage product distribution from a
few thousand miles away? How does one keep up with the competition?

International distribution strategy. There are three ways to set-up global distribution of your products:

 International departments. Setting up international departments means that your brand will
directly enter another country’s market. This gives you complete control on distribution, but elements
like personnel, training, compensation, and cultural background should be considered.

 Working with distributors. Export management companies and export consultants can arrange
your product distribution in foreign areas. Distributors with experience in shipping and importing have
the fastest and easiest procedures when it comes to selling in the foreign markets.
These companies help in establishing your company overseas by exclusively handling the distribution of
your products.

 Online. Export has entered the internet and is now utilizing online tools to send out products into the
world. This has threatened certain foreign distributors, in fear of their services becoming obsolete
within the global market. Although internet may take over the sales function, promotion and shipping
continue to stay offline to a large extent. Local distribution partners may play a role in this.

International departments: setting up your own sales force. This often is the most expensive way of
market entry and may not be viable for companies who only expect to sell limited volumes in the target
country. It gives the most control on operations, but you need to make sure that at least your sales staff is
local, otherwise you may face cultural differences.

There is always a lead time, mostly of about a year before your international department starts generating
revenue. First you should incorporate the company, hire an office, hire staff, and only after their training you
can start with the first sales cycles.

International distribution channels: how to find and manage them? Finding a good foreign
distributor takes time and funds, but an efficient foreign distributor could bring in revenue in a fast and steady
manner.

To get your desired distributor or retail distribution chain, you will need a clear product offering and convincing
arguments why a distributor would benefit from promoting it. How will your product range bring him more

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profit than what he already has on the shelves? On the other hand, you will have to check whether the
distributor has enough reach and a good reputation.

Here are some more items for your evaluation checklist to identify the right distributor:
 You must first investigate the company’s reputation – both its recent and long-running issues must be
scrutinized.
 The company’s competitive profiles would come next. How they stand against other foreign
competitors and local favorites will provide you with an insight to their performance.
 You must weigh the expectations of the company on your distribution support. Avoid picking foreign
distributors whose demands outweighs their services.
 Discussion of requirements for minimum inventory is also considered as an evaluator. Foreign
distributors will display their best performance, and it is up to you to make them prove their capacity.
Choose a distributor that could work around the limitations of your inventory.

When evaluating the candidates for your distribution, keep in mind how well they realize your goals for sales
revenue for their country. Perhaps you should not promise exclusivity and work with multiple distributors.

Online sales: often the cheapest way to test the market. Making use of local online platforms can be a
good way to make your market entry. This way with limited investments you can try out the market.

Step 1: use a drop shipping approach. Make sure that your product is available on the right local
platforms and in the right language. As soon as you get an order, you can ship the product directly to the end-
customer. The right service provider can do this for you, and respond in the local language on any enquiries,
requests, or claims.

Step 2: add local shipping. If volumes increase and become more predictable, you can make your product
more attractive by sending stock to the country, so that you can offer shorter delivery times. Local fulfilment
parties can import your goods, keep your stock, and package and ship your products on demand. This way
you will save on shipping costs, and increase your margins, at least if you have the volumes to overcome the
monthly costs for storage and financing of your local stock.

Step 3: add offline. For several products, it is useful to have offline sales outlets as well, if only for your
customers to touch, feel and try out your products. If the online sales of your product become substantial, it
will also become less risky for retailers to start distributing. Alliance experts knows the market, can easily
select the right retail chains, and approach the most relevant distributors. Read more about our matchmaking
services.

Export distribution strategy. Distributors are like employees and customers in one. They represent your
company and sell your items like an employee while having extremely demanding requirements of a customer.
Some international distributors focus more on the business regarding sales rather than technical service.
Difficult technical problems are usually handled by suppliers while trivial technical issues and support are
covered by the distributor. Ideally, there should be a good rapport between the distributor and the supplier to
optimize distributor performance.

An important factor in the relationship is the distributor margin. You will have to see what a reasonable retail
price is, and which part of the margin between the retail price and your cost price you should give away to the
distributor (and possibly retailer). Balancing these margins will also help balancing the relationship.
Always be aware on which way the dependency works: is the distributor dependent on you or are you
dependent on the distributor. Especially where it comes to large scale retail chains and supermarkets you may
have to pay first to get your product on the shelves: listing fees or slotting fees.

Channel conflicts and management. If you use your own sales force, distributors, and online sales in
combination, then you may get channel conflicts. Your distributor may feel uncomfortable if sales is moving to
online, especially if he has put in a lot of effort to open the market. This requires good financial agreements
but also a good relationship with your distributor.

Here are a few steps in ensuring a smooth supplier and distributor bond:

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  By sharing your vision, practices, and resources with your distributors, you can create a link of trust
that could harmonize mutual benefits. This could also keep your distributors interested in the kinds of
service you will offer to them.
 You should be willing to help your distributor’s business succeed in their endeavors. To achieve this,
you should know your distributor’s company like the back of your hand to create an impact on your
trade relationship. In this way, you have also garnered their respect for your company and their sincere
assistance to help you reach your ultimate goals.
 Feedback from end customers is essential in creating a harmonious relationship between you and your
distributors. Feedback can call out service or item incidence regarding your items. As a supplier, this
feedback could improve your service and items, which in turn, increase the sales and positive image of
your distributors.
 For your international distributors, it is necessary to learn about the culture and traditions of your
distributor to avoid being intrusive or seem dictatorial to them.

Distributors are partners. As a manufacturer, you should learn to treat them with respect the way you would
treat your own employees. Distribution, especially international, is a specialized function that requires great
expertise.

Export marketing supports international distribution. Export marketing involves the creation,
documentation, pricing, and promotion of an offering that will attract overseas customers and buyers. In most
cases the offering will be made available and distributed through an overseas agent or distributor. Export
marketing includes also setting up the right channels for payment.

The difficulty with export marketing compared to general marketing is that you must consider cultural
differences, language differences and differences in payment systems and preferences. E.g., in Western
Europe credit card payments are less common than in the United States. For their export marketing,
companies may hire an Export management company like Alliance experts.

Note: Further discussed in your International Business Trade.

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 MM 117: DISTRIBUTION MANAGEMENT
Midterm
Activity 1
Name: ________________________________ Score: _______________
Course & Year: _________________________ Schedule: ____________

Instruction: Briefly explain your answer. Answers directly copied from google or any search engine shall not
be given credit.

1. Discuss the three types of channel power and give your OWN example each. (15 Points)

The three types of power channel occur in different ways: economic power, expertise/identification
and legitimate right. The first type of channel power arises through economic power; in this sense
the company has the power to reward the other by some means due to its financial situation. An
example to this power is that the company is able to give reward to they’re employees as they are
in good position. Next power occurs when company has a certain expertise and acts as a helping
hand for another, an example of this is that the company lends help by giving or granting them the
power to take control. Channel power also arises through identification of a brand; example is the
completion among brand to be displayed in the company store. Last channel power occurs through
legitimate right, this involves a contractual agreement, this is seen on franchises. An example case
for this is the franchises is under the conditions of the contract, wherein in it has the channel power
of legitimate right, like in the franchise agreement, the franchisee is granted the legal right to
establish a franchise outlet and right to utilize the trademarks.

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 MM 117: DISTRIBUTION MANAGEMENT
Midterm
Activity 2
Name: ________________________________ Score: _______________
Course & Year: _________________________ Schedule: ____________

Instruction: Briefly explain your answer. Answers directly copied from google or any search engine shall not
be given credit.

1. Why is channel management important? Discuss. (10 Points)

Channel Management is widely used in sales marketing, it helps in developing a program for selling and
servicing customers within a specific channel. It is a bridge connecting your business to your customers, to do
you need to know your customers, their needs, buying patterns, and then customize a program that includes
goals, products, sales, and marketing program. By doing this you’ll be able to come with an idea to achieve
your goal, of course each channels could be different, but with this strategy you can always come up with a
better strategy to sell your products and services. With channel management your business will be on the long
run, as establishing alliance and partnerships with different other companies or individuals will benefit your
business and the latter.

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 MM 117: DISTRIBUTION MANAGEMENT
Finals
Activity 1
Name: ________________________________ Score: _______________
Course & Year: _________________________ Schedule: ____________

Instruction: Briefly explain your answer. Answers directly copied from google or any search engine shall not
be given credit.

1. What does the illustration below mean. Discuss thoroughly. (35 Points)

Raw materials ---> component parts ---> product manufacturing---> product/brand

marketing ---> wholesaler ---> retailer---> consumer

It is a supply chain, from raw materials, changing these materials into intermediate and finished products, and
distributing the finished products to customers. It connects suppliers, manufacturers, distribution centers,
retail outlets, and customers to supply goods and services from the point of origin to the point of consumption.
Materials, information, and payments travel in both directions through the supply chain. Suppliers transform
raw materials into intermediate products or components, and then manufacturers turn them into finished
products. Then products are shipped to distribution centers and from there to retailers and customers.

College of Business Management

Distribution Management
Midterm to Finals
14 of 16
 MM 117: DISTRIBUTION MANAGEMENT
Finals
Activity 2
Name: ________________________________ Score: _______________
Course & Year: _________________________ Schedule: ____________

Instruction: Briefly explain your answer. Answers directly copied from google or any search engine shall not
be given credit.

1. State and discuss the difference between Logistics Management and Supply Chain Management. (20 Points)

Logistics management is a component of supply chain management are both parts of the managing goods and
services until it reaches customers but logistics management is more on planning and control. It is a plan
wherein it has all the process managing the raw material, its storage and how the process flow. It does not
end with delivering the final goods to the customer but it also helps in selecting appropriate vendors with the
ability to provide transportation facilities and choosing effective routes for delivery method for the goods not
to be damaged. Meanwhile Supply Chain Management is a process that deals goods and services from start to
finish, it is the handling of the entire flow of the production of goods or services. It is only for obtaining the
raw materials, refining it, manufacturing it, packaging the goods and deliver it to the customer.

College of Business Management

Distribution Management
Midterm to Finals
15 of 16
 MM 117: DISTRIBUTION MANAGEMENT
Finals
Activity 3
Name: ________________________________ Score: _______________
Course & Year: _________________________ Schedule: ____________

Instruction: Briefly explain your answer. Answers directly copied from google or any search engine shall not
be given credit.

1. Discuss the major logistics functions. Give your OWN example each. State when to effectively use each
function. (20 Points)

Major Logistics Functions are done because it reduces cost and who owns a business which doesn’t like
attaining goals with lower cost. The first major logistics function is Warehousing, wherein the production and
consumption do not match at the same time, example is that in winter fur clothes are worn so those clothing
company will stop or store their thin clothes and do more fur coats. Next is the Inventory Management, just
like its name it is an inventory wherein you manage goods you have and materials needed for the demand,
like for example you had restock all your fur coats because it is winter and for this you have a full inventory of
fur coats ready to be sold this is where you manage your inventory, since its winter you order fur coats but
when its summer you would order dress or shorts. This is just to make sure that the inventory you have will
meet the demand of your customers. The third one is Transportation, it is what you choose to transport your
product which can be pricey, for example you had an oversees client then the customer will choose a
transportation your store has like water carries and air carriers, the transportation will vary so as a seller you
need to really think about it. Last one is Logistic Information Management, it the flow and storage of the good.

College of Business Management

Distribution Management
Midterm to Finals
16 of 16