Page 197 - International Marketing

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BRILLIANT'S Overseas Market 199

 Merchants who take title to the goods.
 Agents who do not take title to the goods but who assist in the
transferring of the title.
Each member of a channel is a link in a distribution network of
organizations that extends from the producer of the end-users of products
or services. Although, some firms perform all channel functions, typically
several organizations are linked together in a distribution channel to carry
out the various activities of storage, transportation, sales contract, service,
sorting and repacking.
Where international marketing involves exporting, two categories of
marketing channels are involved viz., channels between the nations and
channels within the foreign market. The International distribution system
consists of two subsystems, namely the domestic system and the foreign
system. The nature of the channel system is affected by among other
things, by the method of exporting.
Functions of distribution channel
Distribution plays an important role in implementation of the
international marketing programme as it enables the products and services
reach the ultimate users. An international marketing firm has an option of
managing its distribution function either directly or indirectly through
middlemen or a suitable combination of two. Distribution channels in
markets around the world are among the most highly differentiated aspects
of national marketing system.
Some of the functions of distribution Functions of
channels are: Distribution Channel
1. Promoting and selling: Distribution 1. Promoting and selling
channels help manufacturers reach to many 2. Buying and assort-
small customers at a low cost. They have ment building
more contacts and is often more trusted by 3. Bulk breaking
the buyer than the distant manufacturer. 4. Warehousing or
2. Buying and assortment building:
Help to select items and build assortments storage
needed by their customers, thereby saving 5. Transportation
customer's much work. 6. Financing
3. Bulk breaking: Save customer's 7. Risk bearing
money by buying in lots and breaking bulk 8. Market information
(breaking large lots into small quantities). 9. Pricing
4. Warehousing or storage: They hold 10.Merchandizing and
inventories, thereby reducing the inventory contracting
costs and risks of suppliers and customers.