THARAKA DIASMBA(USA), BBA(USA), Dip in Mgt, ACIM(UK), FAEA(Dip in AEA-UK),

FinstSMM(UK), CPM(Asia), MSLIM, PM(Sri-Lanka) 1

The structure of the global distribution system

Foreign-market channel members Analyzing national channels Factors influencing the selection of

channel members Locating and selecting channel partners Managing global distribution Gaining access to distribution channels Global logistics Global trends in retailing Smuggling

2

Level of economic development Consumer disposable income Infrastructure quality Culture Physical environment Legal/political system

3

Channels of distribution provide essential linkages between manufactured products and the consumer

4

Import intermediariesLocal wholesalers (dealers,

distributors)Local agentsRetailers

5

Distribution densityChannel lengthChannel alignment and leadershipDistribution logistics

6

CostsProduct and product lineControl, coverage, and synergy

7

U.S. Department of Commerce

Banks Directories Trade shows

Competitors’ distribution partners

Consultants Associations Foreign consulates

8

Develop a distribution strategy. Establish criteria for selecting distribution

partners. Locate potential distribution partners. Solicit the interest of distributors. Screen and select distribution partners. Negotiate agreements.

9

Piggybacking – Another company that sells to the same consumer segments takes on the new products

Joint ventures – Partnership typically between local firm with market access with a foreign firm with no local access

Acquisitions – Purchasing a local company with existing distribution system

Gaining Access to Distribution Channels

10

Traffic or transportation management Inventory control Materials handling and warehousing Fixed-facilities location management

11

Resources to support the system Exchange rate fluctuations Availability of infrastructure Ease of working with host governments Costs of the system

12

Encompasses more than the traditional concept of logistics Logistics Marketing relationships Product development & rollout Management of product returns

13

Three categories:1. Replicators – Export model virtually

unchanged2. Performance Managers – Acquire existing

retailers and develop as independent entities3. Reinventors – Employ standardized back-

end systems and processes while creating tailored retail format

14

Smuggling – Illegal transport of products across national borders Illicit products Illegal distribution of products that are

legal to sell and use

15

16