One of the most important decisions accepted by the company at a conclusion of production on the market is a trade channel choice. The cheapest, but frequently the least effective way is a sale of production directly from a factory warehouse to any who is ready to pay. In the given model lorries are necessary to the company only for delivery of raw materials to factory. Financial expenses for sale are minimum. But such approach never will give good results in the long-term plan as many competitors know that the secret of successful sales consists in the control of retail trade. It makes sense to choose some trade channels and to define success of each of them. It is better to make it by subtraction of the cost price of the goods of the price of sale and comparison of a difference with sale cost in each channel.
•Among possible channels of sales we will consider the following:
At the heart of work in this channel lies the price policy. Wholesalers usually work on a small difference between the price of purchase and sales, and it is difficult to manufacturer to dictate the prices for the production in points of retail trade. Many wholesalers also participate in price wars. But the basic problem in this channel is the absence of the control over retail. The wholesaler is ready to sell everything to any who is ready to buy. It means that thus it is very difficult to manufacturer to get and keep repeat clients. Production can be on sale in shop within three weeks, and then a precipice because the wholesaler has sold a new consignment of goods in other place. Also wholesalers seldom pay attention to production arrangement on shop regiments though researches show that the sales volume of the goods focused on the spontaneous buyer can vary from 10 % to 80 %. At last, wholesalers demand often unreal conditions of prolongation of credits and terms of the payment of invoices. Thus, reception of money can become the serious problem influencing a total gain and on possibility to buy raw materials
The open markets
In the wholesale markets as a rule it is required to rent the container. The truck with production which will be on sale on a place or the sales representative who will accept orders with production delivery in one-two day can serve the retail markets. Depending on the goods it can be the fine possibility of distribution allowing the manufacturer to work with points of retail which are too small that the department of retails could serve them effectively. In this case it is necessary to work with cash as many sellers in the open markets can disappear simply next day. But this channel should be used only in addition to other, more important channels.
It is the most important channel and it is possible to use it in two ways:
– The least effective way is services of wholesalers or distributors which have a command of retail. Frequently employees of department of sales at such distributors are badly trained, the motivation system is absent. Also distributors seldom invest in development of the information technology allowing to organise the first class system of retail.
– The most effective, but also the most expensive way of use of this channel is a creation of own department of sales. It demands investment in training, cars and mobile phones for the employees who are engaged in sales and effective process of selection of the personnel.
Today it is quite easy to find a good business 2 business connection – this is where a professional appointment setting can help you a lot.
And a final piece of advice – today the Internet technologies give you a truly unique chance to choose what you want for the best price on the market. For example, search for free insurance quotes. You will be surprised how fast you can receive variety of products and prices for them. Funny, but most of the people don’t use this chance. In real practice it means that you must use all the tools of today to get the info that you need.
Search Google and other search engines. Visit social networks and have a look on the accounts that are relevant to your topic. Go to the niche forums and join the online discussion. All this will help you to build up a true vision of this market. Thus, giving you a real opportunity to make a smart and nicely balanced decision.
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