Type
Solution Manual
Book Title
Marketing 5th Edition
ISBN 13
978-0077729028

978-0077729028 Chapter 16 Slides

April 8, 2019
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
Powerpoint Slides With Teaching Notes
Power Point Slide Teaching Notes
16-1: Supply Chain Management
16-2: Learning Objectives Ask students: How has Walmart aligned its
systems.
The opening vignette describes distribution
efficiencies through technology innovations.
16-3: Amazon Ask students: How has Amazon aligned its
systems.
The opening vignette describes distribution
efficiencies through technology innovations.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 1
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-4: The Importance of Marketing
Channel/ Supply Chain
Management
Students of marketing often overlook or
underestimate the importance of place in the
marketing mix, simply because it happens
behind the scenes.
Yet marketing channel management adds value
because it gets the products to them efficiently,
quickly and at low cost.
16-5: Supply Chain Management Ask students: Why would a supply chain be
more efficient with a distribution center rather
than simply delivering directly to stores?
Answer: The distribution center serves as a
place to accumulate merchandise from many
vendors and then allocate it to stores in the
quantities they need.
Imagine the congestion if every vendor had to
deliver to every store.
16-6: Behind the Scenes at Costco This clip looks behind the scenes at Costco and
evaluates their supply chain and approach to
logistics.
Note: Please make sure that the video file is
located in the same folder as the PowerPoint
slides.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 2
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-7: Supply Chains Add Value Without supply chain management, firms
would face significant complications in getting
their goods to consumers where they want
them.
Group activity: Each member of the group
represents a supply chain link (e.g.,
manufacturer, retail distribution center, retailer,
transporter, end customer).
Remove one link and attempt to move an object
like a pen from one end to the other.
Experiment with removing different links.
What happens?
16-8: Supply Chains Streamline
Distribution
Ask students: How does supply chain
management reduce inventory levels? What
effect does supply chain management have on
sales?
Answer: An efficient supply chain can lower
overall inventory in the system because
merchandise is delivered when it is needed
(just-in-time).
By having an efficient supply chain, the
retailers stay in stock, and sales increase.
This is a classic FedEx ad with John Moscitta,
the fast talking guy, which reinforces the
importance of distribution.
16-9: Supply Chain Management
Affects Marketing
Customers expect to have their goods delivered
and services performed on time.
Ask students: What happens when the supply
chain breaks down? Imagine you order a
textbook from Amazon, which promises to
deliver it by Saturday, before your classes start
on Monday.
What happens in terms of your satisfaction with
Amazon if some link in the supply chain breaks
down and you don’t receive your book until
Tuesday?
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 3
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-10: Designing Marketing Channels There are no intermediaries between the buyer
and seller in a direct marketing channel.
In indirect marketing channels, one or more
intermediaries work with manufacturers to
provide goods and services to customers.
16-11: Managing the Marketing Channel
and Supply Chain
Managing a supply chain is similar to managing
your personal relationships. When conflict
occurs, it is best to try to come to a resolution
through negotiations:
Group exercise: Divide the class into group
dyads: one a manufacturer and one a retailer.
Make each group have a dominant member.
So, one group would be Wal-Mart (dominant),
while the other group would be a small vendor.
Another group would be P&G (dominant),
while the other group would be a small grocery
chain.
Have the groups negotiate a sale.
Then have the group’s report what transpired.
It will be interesting to see how the dominant
group used their power.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 4
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-12: Managing Supply Chains Through
Vertical Integration
Control in a supply chain varies depending on
the type of relationships.
You might compare supply chain relationships
to more personal relationships familiar to
students, such as a group of their friends versus
a professional networking association to which
they belong.
Ask students: How does the formality of your
relationships in each group affect your
influence over other members or other
members’ influence over you?
The more formal the relationship, the more
control one member has over the others.
16-13: Types of Vertical Marketing
Systems
Group exercise continued: Have students
describe which type of supply chain channel
they are in.
Explain how cooperation is fostered through
more formal supply chain relationships.
In essence, cooperation is naturally greater in a
corporate system than in an independent supply
chain.
16-14: Power Power in a marketing channel exists when one
firm has the means or ability to dictate the
actions of another member at a different level
of distribution.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 5
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-15: Managing Supply Chains Through
Strategic Relationships
Continue with the personal example developed
above.
Explain how, like supply chain relationships,
like personal relationships are stronger when
there is mutual trust, open communication,
common goals, and credible commitments.
Have students provide specific examples.
16-16: Relationship of supply chain
members
The National Milk Processor Board is the
originators of this ad campaign.
Helping fuel growth in consumption due to
increased competition by other drinks.
Increase in milk consumption favors the
processors, the farmers, the distributors and the
retailers – many members of the supply chain.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 6
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-17: Check Yourself 1. There are no intermediaries between the
buyer and seller in a direct marketing
channel. In indirect marketing channels, one
or more intermediaries work with
manufacturers to provide goods and
services to customers.
2. In an administered vertical
marketingsystem there is no common
ownership or contractual relationships, but
the dominant channel member controls or
holds the balance of power. In contractual
vertical marketing systems independent
firms at different levels of the marketing
channel join together through contracts to
obtain economies of scale and coordination
and to reduce conflict. In a corporate
vertical marketing system, the parent
company has complete control and can
dictate the priorities and objectives of the
marketing channel because it owns multiple
segments of the channel, such as
manufacturing plants, warehouse facilities,
and retail outlets.
3. Successful strategic relationships require
mutual trust, open communication, common
goals, and credible commitments.
16-18: Information Flows Each step requires the collection and
dissemination of information.
Group exercise: List the information that each
member of the supply chain hopes to gain from
each flow.
Now list the information each member
disseminates during each flow
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 7
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-19: Electronic Data Interchange The growth of EDI systems has allowed for
advanced tracking of information. Each system
can seamlessly integrate with others, which
creates value for both customers and the firm.
Ask students: Exactly how does EDI increase
value for end customers?
Answer: Since EDI facilitates information, it
makes it easier for retailers to plan their
deliveries (advance shipping notice) and plan
their inventories (CPFR). Other information is
handled through EDI as well. The bottom line
is the retailer has the merchandise the customer
wants when he/she wants it, and in the
quantities that are demanded.
16-20: Vendor-Managed Inventory Vendor-managed inventory (VMI) is an
approach for improving supply chain efficiency
in which the manufacturer is responsible for
maintaining the retailers inventory levels in
each of its stores.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 8
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-21: Check Yourself 1. Flow 1 (Customer to Store) , Flow 2 (Store
to Buyer), Flow 3 (Buyer to Manufacturer),
Flow 4 (Store to Manufacturer) , Flow 5
(Store to Distribution Center), Flow 6
(Manufacturer to Distribution Center and
Buyer)
2. As shown on the horizontal axis, data can
be accessed according to the level of
merchandise aggregation—SKU (item),
vendor, category (e.g., dresses), or all
merchandise. Along the vertical axis, data
can be accessed by level of the company -
store, divisions or the total company.
Finally, along the third dimension, data can
be accessed by point in time - day, season,
or year.
3. Electronic data interchange (EDI) is the
computer-to-computer exchange of business
documents from a retailer to a vendor and
back.
4. Although it is a more advanced level of
collaboration than simply using EDI and
sharing information, retailers cannot use
VMI blindly. Whereas the manufacturer
coordinates the supply chain for its specific
products, it does not know what other
actions the retailer is taking that might
affect the sales of its products in the future.
5. In a pull supply chain —orders for
merchandise are generated at the store level
on the basis of sales data captured by POS
terminals. In a push supply chain, the
merchandise is allocated to stores on the
basis of forecasted demand.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 9
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-22: Making Merchandise Flow Remind students that supply chains enable the
flow of not just information but also goods.
Keeping goods flowing is not a simple task.
Ask students: Under what circumstances might
a manufacturer deliver directly to stores (flow
2) rather than to a distribution center (flow 1)?
Answer: 1. Because the retailer demands it. 2.
Because merchandise is bulky (furniture) or
needs to be delivered daily (tortillas)
16-23: Bakery with Conscience This video shows Dancing Deers’ CSR
initiatives but at the same time offers many
views of the production, packaging and
shipping of their product.
Note: Please make sure that the video file is
located in the same folder as the PowerPoint
slides.
16-24: How does Dell’s Merchandise Flow Students may know that Dell sells through
retailers but also directly to end consumers.
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 10
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-25: Distribution Center vs. Direct Store
Delivery
Distribution centers are not best if the retailer
has few outlets and/or the stores are
consolidated.
The following list are some advantages of
having a distribution center:
more accurate sales forecasts due to many
stores
lower inventory in each story therefore
lower overall inventory costs
overstock and under-stock is less of a
problem
it is less expensive to store in a remote
warehouse then expensive retail location.
16-26: The Distribution Center Group Project Ask student to draw out the
distribution center for a pair of Nike shoes that
are at a Footlocker distribution center.
For each stage, ask them to list 3 things that
will happen to the item and 1 thing that might
go wrong!
This YouTube video (check link before class) is
a segment on ABC news on a Walgreens
warehouse where 40% of their employees are
disabled.
This video is a nice way to link CSR and
supply chain.
16-27: Inbound Transportation Buyers and planners are much more involved in
coordinating the physical flow of merchandise
to the stores.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 11
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-28: Receiving and Checking After goods arrive at their destination, the
recipient must account for them.
RFID has the potential of tracking merchandise
throughout the supply chain. Items wouldn’t
have to be physically checked.
A distribution center or a store could know
exactly where and how many of an item it has
because each item has an RFID tag.
Some are concerned, however, about consumer
privacy—being able to track a consumer that is
wearing apparel with and RFID tag.
16-29: Storing and Cross-Docking Remind students that one of the most important
functions of the supply chain is to hold
merchandise until the next link in the chain is
ready for it.
But many firms strive to hold merchandise a
minimum amount of time because holding
merchandise in a distribution center is
expensive and the merchandise is not available
for sale. So cross-docking distribution centers
are part of just-in-time delivery systems.
Ask students: Which type of distribution
center is best for minimizing inventory in the
supply chain?
Answer: cross-docking
16-30: Getting Merchandise Floor-Ready Many firms now require that manufacturers
ship floor-ready merchandise, which shifts the
burden of ticketing and marketing to the
manufacturer.
Ask students: What cost implications do these
requirements have for manufacturers and
retailers?
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 12
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-31: Shipping Merchandise to Stores Technology facilitates shipments to stores by
tracking item sales and thus triggering
replacement orders.
Ask students: How do automatic ordering
systems benefit manufacturers, retailers, and
customers?
Answer: Manufacturers can plan their
production schedules. Retailers get more
accurate forecasts. Customers get the
merchandise they want, when they want it.
16-32: Inventory Management Through
Just-In-Time Systems
Inventory management systems track goods
throughout stores, warehouses, and DCs.
As its name implies, just-in-time inventory
management ensures goods get delivered only
when they are needed.
This web link is for the Zappos tour mentioned
in the textbook.
16-33: Benefits of JIT Systems Because they use smaller but more frequent
shipments, JIT systems reduce stock-out
situations which in turn increase customer
satisfaction.
Ask students: Can you think of any potential
problems with this inventory management
approach?
Answer: The systems can be expensive and the
supply chain partners must be committed to
accurate data or they won’t work. Also, if the
system isn’t working properly, out-of-stocks
can occur.
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in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 13
Chapter 16 - Supply Chain Managementand Channel Management Marketing 5th
16-34: Check Yourself 1. Manufacturing Distribution Center
(optional) – Store – Customer
2. Management of inbound transportation,
Receiving and checking using UPC and
RFID, Storing and Cross-Docking, Getting
Merchandise Floor Ready, Preparing to
ship, Shipping to store
3. JIT leads to reduced lead time, increased
product availability, and lower inventory
investment.
© 2015 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution
in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part. 14

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