With the advent of mass production, production is increasingly concentrated in a few factories, few factories produce large quantities of standardized products and achieve greater economies of scale. However, when the scale of production trends continue, a factory or a company’s product sales capability must be difficult to meet the huge expansion of production capacity, distribution problems will inevitably arise.
In modern markets, compared with the production of products, purchases of most products is relatively much less. Industrial products or household goods are manufactured by different vendors numerous product composition. Deliver products to the final consumer is the distribution task. Distribution method chosen by the company must be able to reflect the image and the nature of the product itself. A jam manufacturer intends to expand the market will not be able to sell only through Ford Hotspur and Meissen operated stores, expensive and because the unique fragrance can not be sold in the energy market, and should be sold in stores.
Production requirements of large-scale, mass, and marketability over a wide geographical area is small quantities purchased. Diverse and not fixed. The increase in distribution costs can not be greater than the cost advantage of mass production, economies of scale can not because the distribution network is not suitable for a product and a market loss. Min depends on product supply and sales, the manufacturer through the distribution made him the products to capture the market.
In order to achieve volume sales, Microsoft has adopted the most effective but also the most controversial innovative promotions, namely the manner processor transfer permission for distribution, to repel the opponent’s goal. In 1988, Microsoft began to particularly low royalties to hardware company MSDOS, on condition that the requirements of hardware companies according to sales charge, regardless of whether the MSDOS and each computer with the sale. Such contract terms to simplify the calculation method, and reduces the difficulty of forecasting. Microsoft provides only one piece of software to hardware companies master disc, which can be easily copied. Without having to save the record, and without paying royalties, but Microsoft can keep abreast of the company’s computer hardware (processor) sales. This approach allows Microsoft products sell up immediately, plus hardware companies hope to get sales discounts rather than integration with other software, to further ensure Microsoft’s market dominance.
Traditional distribution goal is simply to sell out as much as possible through intermediaries or direct marketing of their products. Since this goal is generally only consider the company’s own profits, while ignoring or harm the interests of distributors, will eventually harm the interests of the company.
Distribution theory of modern thinking win-win cooperation for guidance. Therefore, the company is no longer just a modern economy, but also a social entity, the nature of marketing has changed fundamentally; it is not only for the company’s goals, but also for the distributors service.
The company and distributor relationships based on interest on. For both the true distribution of mutual benefit. Therefore, the top marketing manager In developing the distribution targets. We should first understand where the interests of both sides to seek a community of interests of both sides. And efforts to make the common interests of both sides can be maximized or satisfaction of.