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How to design and manage distribution channels effectively
Design and selection of distribution channels

1. What are the factors that affect the choice of distribution channels?

In channel selection, enterprises should comprehensively consider channel objectives and various constraints or influencing factors. The main limiting factors are:

Market factors?

The size of the target market. The target market is big, the channel is long, on the contrary, the channel is short.

The concentration of target customers, if the customers are scattered, should use long and wide channels, on the contrary, should use short and narrow channels. ? Product factors?

Perishability or perishable nature of products. If the product is perishable or perishable, use direct or short distribution channels.

Product unit price. If the unit price of products is high, short channels or direct channels can be used, otherwise indirect promotion channels can be used.

The volume and weight of products, large and heavy products should choose short channels; Small and light products can be sold indirectly.

The technicality of the product. Products with complex technology and requiring installation and maintenance services can be sold directly, otherwise they can be sold indirectly. ?

The factors of the production enterprise itself?

The strength of the enterprise. It mainly includes manpower, material resources and financial resources. If the enterprise is strong, it can establish its own distribution network and implement direct sales. Otherwise, it should choose middlemen to promote its products.

An enterprise has strong management ability. If an enterprise has strong management ability and rich marketing experience, it can choose direct sales channels, otherwise it should adopt middlemen.

Enterprise's ability to control channels. In order to effectively control distribution channels, most enterprises choose short channels. On the contrary, if enterprises do not want to control channels, they can choose long channels. ?

Relevant government legislation and policies?

Such as monopoly system, anti-monopoly law, import and export regulations, tax law and so on. For another example, tax policy, price policy and other factors all affect the choice of distribution channels for enterprises. For example, when tobacco and alcohol are monopolized, these enterprises should choose distribution channels according to law. ? What are the characteristics of middlemen?

Various middlemen have different strengths and characteristics, such as advertising, transportation, warehousing, credit, training personnel, delivery frequency, etc., which affect the choice of distribution channels for production enterprises. ?

Influence of different middlemen on distribution channels of production enterprises;

For example, car radio manufacturers consider distribution channels, and their choices are:

A. Sign an exclusive contract with the automobile manufacturer, requiring the automobile manufacturer to install only the radios of this brand;

B. Require wholesalers to resell radios to retailers through common channels;

C. find some car dealers who are willing to sell their own brands;

D. Set up a car radio assembly station at the gas station, sell it directly to car users, negotiate with local radio stations, sell products for them and pay corresponding commissions. ?

The influence of different numbers of middlemen.

According to the number of middlemen, we can choose intensive distribution, selective distribution and exclusive distribution.

Intensive distribution means that manufacturers choose more distribution agents to sell products at the same time. Generally speaking, this distribution form is used for daily necessities. General raw materials, small accessories and standard parts in industrial products can also be distributed in this form.

B selective distribution refers to choosing more than one middleman to sell the products of the enterprise in the same target market, instead of choosing all the middlemen who are willing to distribute the products of the enterprise. This is conducive to improving the operating efficiency of enterprises. Generally speaking, this form of distribution should be adopted for purchased goods and special goods in consumer goods and spare parts in industrial products.

C exclusive distribution means that an enterprise only chooses one middleman to sell its products in a certain target market in a certain period of time. The two sides signed a contract, stipulating that middlemen should not deal in competitors' products, and manufacturers should only supply to selected distributors. Generally speaking, this form of distribution is suitable for household appliances in consumer goods and special machinery and equipment in industrial products, which is conducive to cooperation between the two parties in order to better control the market.

Quantity purchased by consumers. If consumers buy less, they can use long channels; On the contrary, if they buy a lot, they can use short channels.

Competitor status. When the market competition is not fierce, the distribution channels similar to those of competitors can be adopted, on the contrary, the distribution channels different from those of competitors can be adopted.

2. Evaluate and select the allocation scheme

After the distribution channel scheme is determined, manufacturers should evaluate according to various alternatives to find out the best channel route. Generally speaking, there are three criteria for evaluating channels: economy, controllability and adaptability, of which the most important is the economic criterion.

Standard evaluation of economy?

Mainly to compare the possible sales and cost levels of each scheme. ?

Compare the sales staff of this enterprise with direct selling and using sales agents, which way has a higher sales level?

Comparing the cost of setting up sales outlets for direct sales with the cost of using sales agents, we can see that the cost is relatively high, and enterprises weigh the above situation and choose the best distribution method. ?

Evaluation of controllability standard?

Generally speaking, the use of middlemen is less controllable, the direct selling of enterprises is more controllable, the distribution channels are long, the controllability is difficult, and the controllability of short channels is easier. Therefore, enterprises must make a comprehensive comparison and weigh, and choose the best scheme. ?

Evaluation of adaptability standards?

If the contract between the manufacturer and the selected middleman is long, during this period, other sales methods such as direct mail are more effective, but the manufacturer cannot terminate the contract casually, and the enterprise lacks flexibility in choosing distribution channels. Therefore, production enterprises must consider the flexibility of choosing strategies, and do not sign contracts for too long unless they have very superior conditions in economy or control.

3. Distribution channel management and control?

After selecting the channel scheme, enterprises must select and evaluate the middlemen and adjust the channels according to the changes of conditions. ?

The starting point of control?

It is necessary to look at the overall situation from both the producer's own point of view and the middleman's point of view. Usually manufacturers complain about middlemen: they don't pay attention to the sales of certain brands; Lack of product knowledge; Do not use the advertising materials of manufacturers seriously; Sales records cannot be saved accurately. ?

But from the point of view of middlemen, they think that they are not a part of the distribution chain hired by manufacturers, but independent institutions, and their policies are not interfered by others; The products he vigorously sells are products that customers are willing to buy, not necessarily the products that manufacturers tell him to sell, that is to say, his first role is for customers to buy agents, and his second role is for manufacturers to sell agents; If manufacturers do not give special rewards to middlemen, middlemen will not keep records of selling various brands. Therefore, manufacturers are required to consider the interests of middlemen and control them effectively through coordination. ?

How to control it effectively?

For example, a sales commission of 25% can be paid to dealers according to the following standards: 5% can be paid to maintain an appropriate inventory level (in case of document breakage); If the sales target can be achieved, pay another 5%, and if the customer can be served (installation and maintenance), pay another 5%; If the satisfaction of the final customer's purchase can be reported in time, another 5% will be paid; If the accounts receivable can be effectively managed, another 5% will be paid.

Encourage channel members

Encourage channel members to accomplish sales tasks well. To motivate channel members, we must first understand the needs and aspirations of middlemen, and at the same time handle the relationship with channel members, including three aspects:

cooperate

Production enterprises should get the cooperation of middlemen. Therefore, positive incentive measures should be taken, such as giving higher profits, giving special treatment in transactions and giving promotion subsidies. Occasionally, negative sanctions should be taken, such as threatening to reduce profits, delaying delivery, terminating relations, etc. However, the negative effects of this method should also be paid attention to.

Form a partnership

Manufacturers and middlemen cooperate with each other in sales area, product supply, market development, capital demand, market information, technical guidance and after-sales service. And reward the middlemen according to their compliance with the contract.

Distribution planning

This is the most advanced method. This should be a vertical marketing system with planned and professional management. In combination with the needs of manufacturers and middlemen, a distribution planning department should be set up in the enterprise marketing department to jointly plan marketing objectives, inventory levels, venue and visual management plans, personnel sales promotion, advertising and promotion plans with distributors.

Case: Lenovo Technology Mall

Lenovo Science and Technology Mall, established in 1997 and 10, is one of the 13 parallel business divisions under Lenovo Science and Technology Development Corporation. Its predecessor was Lenovo store, and many business departments started here. Now it has become a wholly-owned subsidiary of Beijing Legend Holding Company and an independent registered legal person. Mall has built a basic national central city chain network, and has established its own branches in nine cities across the country, including Beijing, Shanghai, Guangzhou, Shenyang, Chengdu, Wuhan, Jinan, Xi and Nanjing. At present, the annual sales revenue has reached about 700 million yuan, and IT is the largest chain direct selling organization of IT products in China.

The entry of Lenovo Science and Technology Mall in Hailong Building marks the transformation of Lenovo Science and Technology Mall from a mall operating Lenovo brands and Lenovo agent brands to a mall operating integrated IT products. In the words of Lenovo Technology, "We want to build a brand new brand. Whether it is Lenovo's products or those of other manufacturers, as long as users accept them, we will operate them. On the contrary, if users don't accept products, even Lenovo products, we will eliminate them from the mall. "

Lenovo established this new brand to show the industry a determination that the future mall will be completely built into a neutral mall.

Except that the mall was born out of Lenovo, it will maintain the essence of Lenovo management in its management style. The mall will never influence the cooperation between the mall and other manufacturers with Lenovo's existing business, and will never artificially influence the choice of users.

Why does Lenovo want to establish such a brand-new brand, a chain mall with direct sales as the mainstay? Let's first analyze the business model of Lenovo Computer Mall.

To sum up, "Lenovo Computer Mall" has several characteristics: First, it is a national chain. So far, Lenovo Science and Technology Mall has established branches in nine central cities across the country, becoming the largest chain direct selling organization of IT products in China. Second, relative direct sales. Shortening the channel level will narrow the distance between manufacturers and users and reduce the distortion of manufacturers' services; Reduce filtering levels, thus reducing sales costs; Third, comprehensive management. Mall is a neutral mall that deals in comprehensive information products. It will introduce a competitive mechanism and treat any brand equally. Shopping malls set up a platform for manufacturers, set a set of rules, and manufacturers act on their own; Fourth, from traditional store sales to supermarket management. The sales model of shopping malls has some basic characteristics of supermarkets: customers can directly contact the products they want and have high affinity.

The business model of Lenovo Technology Mall always takes users as the business center, not products. China computer industry has been a buyer's market for a long time, and meeting customers' needs is always the cornerstone of every enterprise.

From the user's point of view, information products are characterized by high cost, low profit and small price change. Compared with most domestic users, information products are a luxury. Therefore, most customers want to get the real delivery of manufacturers' products and services first. Second, get preferential prices. The sales model of Lenovo Computer Mall can shorten the sales link, on the one hand, ensure the supply of goods and ensure the real delivery of manufacturers' products and services. On the other hand, by lowering the sales level and reducing the sales cost of products, it lays the foundation for realizing profit-making for users. Secondly, users' demand for information products is a kind of vague demand. Most users are not clear about the corresponding relationship between the performance and use of computers, but only have some general uses. They need professional, honest and skilled professionals to explain and introduce them fairly. Lenovo Computer Mall professional salesman team can meet this demand and provide one solution after another. Thirdly, users' demand for information products is comprehensive. The information products purchased by users often range from microcomputers to peripherals and network products, and it is a psychological burden for many users to travel to multiple businesses to buy different products. The characteristics of Lenovo Computer Mall, a comprehensive information product store, enable it to meet the "one-stop shopping" needs of users.

From the manufacturer's point of view, reducing the channel level has become the consensus and demand of manufacturers. Lenovo Computer Mall, a relatively direct sales, effectively reduces the sales level. At the same time, because the mall is a relatively closed sales system, it will not have a negative impact on the original channels of manufacturers, which adds a choice for the channel strategy of manufacturers.

The standardized operation of Lenovo Computer Mall can create a concept in consumers' minds. The specifications and prices of products in the mall are the standard image and approximate price of products, which can meet the needs of manufacturers to standardize channels. In other words, the mall has the function of price balancer and can be used as a channel standard.

The business form of Lenovo Computer Mall comprehensive information product store can meet the needs of manufacturers to display product image. With the maturity of technology and the advent of the Internet era, manufacturers are more and more aware that their marketing is not only the sales of a single product, but more importantly, it is to convey the relevant information of related products to users reasonably. The stores of Lenovo Computer Mall are located in the local information product sales center, and there are many effective users in the store. Displaying the image in it can convey the relevant information of related products to users.

Customer relationship management in the Internet age is a hot topic. Internet has changed the management mode and management mode. Before the Internet appeared, users had to obtain various services through different interfaces. Now the Internet has laid a foundation for businesses to provide users with a unified service interface, so that users can get a variety of services anywhere through a unified interface. The key to realize this service model transformation is to establish a strong customer management system, and at this point, no matter IBM, Compaq or other manufacturers, everyone is standing on the same starting line. How to retain customers, seize customers, maintain customer loyalty, and how to deal with customers. , is a concern of all manufacturers today. The new customer-centered business model will become the standard model in the Internet era.

The direct selling of Lenovo Computer Mall is based on the needs of end users, customer-centered, and aims to meet the specific needs of users as soon as possible and perfectly. Is that products and services are after-sales. On the other hand, the Science and Technology Mall can accumulate a large number of users in its business activities (at present, it has 65,438+10,000 end-user resources) and accumulate experience in customer relationship management, which meets the needs of the Internet.