Channels and Distribution Strategies Learning Objectives: Understand the channel structure and the linkages between the

e buyer and the seller The Channel Design (11 Cs) Selection of Intermediaries Channel Management International Shipment - Documentation

- Support Agencies for international shipment

 Importance of Distribution Channels Channels configurations - Consumer goods - Industrial goods - Services In international distribution, The firm sells to its customers - Through its own sales force - Through independent intermediaries - Through an outside distribution system with regional/global coverage Channels structure should be designed to manage - Physical flow of goods and services - Transactional flows - Information flows

 Channels Design

- Customer Characteristics - Distribution culture - Competition - Company objectives (for market share and profitability) - Character (nature of product, positioning of the product) - Capital (financial requirement) - Cost (cost incurred in maintaining the channel) - Coverage (intensive, selective, exclusive distributions) - Control (product/service presentations, quality, image) - Continuity - Communication

 The concept of channel captain and power - Reward - Coercive - Legitimate - Referent - Expert

Type of Distance that cause communication problem

- Social Distance - Culture Distance - Technological Distance - Time Distance - Geographical Distance

 Selection of Intermediaries

Agent Foreign (Direct) - Brokers - Manufacturers Representative - Factors - Managing Agents - Purchasing Agents Domestic (Indirect) - Brokers - Export Agent - EMCs - Webb-Performance Association - Commission Agents

Distribution Foreign (Direct) - Distribution/Dealers - Import Jobbers - Wholesalers/retailer Domestic (Indirect) - Domestic wholesalers - EMCs - ETCs - Complementary marketers Types of Distributors

- Indirect Exporting - Direct Exporting - Integrated Distribution

 Sources for finding Intermediaries - Govt. Agency - Private Sources Criteria for Screening Intermediaries - Performance - Professionalism Distributors agreement includes

- Contract duration - Geographic boundaries - Compensation - Products and conditions of sale - Communication between parties

 Channel management - Coordination - Long term relationship Factor in channel management - Ownership - Geographic, culture and economic distance - Difference in rules of law Gray Market (Parallel Imports)

- Why Gray markets occur - How to handle Gray markets Typical reasons for termination of channel relationship - Change in international marketers distribution strategy - Lack of performance by the intermediary - Make the terminators conditions explicit in the agreement

Documents Required for International Shipments

Documents required by U.S Government - Shipper export declaration - Export license Commercial Documents - Commercial Invoice - Packing list - Inland bill of lading - Dock receipt - Bill of lading - Insurance Certificate - Shippers declaration of dangerous goods Import Documents - Import license - Foreign exchange license - Certificate of Origin - Consular Invoice - Customs Invoice

 Support Agencies for International Shipments

- Freight forwarder - Customs broker - Common carrier