Marketing Intermediary
 A business firm that operates between producers
and consumers or business users, also called a
middleman.
 May be a wholesaler, retailer, or facilitating
intermediary.
Retailing
© PhotoDisc
 Activities involved in selling goods
and services to ultimate consumers
Retailing
Wholesaler
© PhotoDisc
 Activities involved in selling goods
and services to ultimate consumers
 An intermediary that handles the
redistributes of goods to retailers,
other distributors, and sometimes end
consumers
Retailing
Wholesaler
Direct
Marketing
 Activities involved in selling goods
and services to ultimate consumers
 An intermediary that takes title to the
goods it handles and redistributes
them to retailers, other distributors,
and sometimes end consumers
 A distribution channel consisting of
direct communication to a consumer
or business recipient
Figure 14.2: Major Types of
Wholesaling Intermediaries
Types of Wholesaling Intermediaries
ManufacturerOwned Facilities
Square D
 Sales branch: carries
inventory and processes
orders from available stock
 Sales office: serves as a
regional office for for
manufacturer’s sales
personnel, but does not
carry an inventory
Types of Wholesaling Intermediaries
ManufacturerOwned Facilities
Americas Mart
 Trade fair: Periodic show in
which manufacturers in a
particular industry display
their products and services for
wholesale and retail buyers
 Merchandise mart: A
permanent facility in which
manufacturers display
products for visiting
wholesale buyers
Types of Wholesaling Intermediaries
 Merchant wholesaler: An
independently owned
intermediary that takes title to the
goods it sells
 Merchant wholesalers include:
Independent
Wholesaling
Intermediaries
 Rack Jobbers
 Cash-and-Carry
Wholesalers
 Truck Wholesalers
 Drop Shippers
 Mail Order Wholesalers
Types of Wholesaling Intermediaries
Independent
Wholesaling
Intermediaries
 Agents and Brokers: A second
group of independent
intermediaries who may or may
not take possession of the goods,
but never take title. They
include:





Commission merchants
Auction houses
Brokers
Selling agents
Manufacturer’s agents
Types of Wholesaling Intermediaries
Independent
Wholesaling
Intermediaries
 Manufacturers’ agent: A
wholesaling intermediary
who represents multiple
manufacturers of related,
but noncompeting products
 Work on a commission
basis and are assigned to
geographic territories
Fundamental Retail Challenges: Shelf
Space
 Stockkeeping unit (SKU): specific product
offering within a product line that is used to
identify items within the line
 Slotting allowances: fees paid by
manufacturers to secure shelf space from
retailers for their products
 Assortment Management: selecting the right
mix of products and product lines to meet
target market.
Types of Retailers
 Retailers can be categorized by:
 Form of ownership
 Shopping effort by customer
 Services provided to customers
 Product lines
 Location of retail transactions
 Classifying by Product Lines: This classification
system groups stores by the product lines they
carry.
 Limited-line store: A retailer that offers a
large assortment within a single product line, or
within a few related product lines
 Examples include IKEA home furnishings and
Ethan Allen furniture
 Category killers: retailers that combine huge
selection and low prices within a single product
category
 Home Depot and Staples are examples
 Department store: large store that offers a
variety of merchandise, such as men’s and
women’s clothing, appliances, linens, and
furniture
 Mass merchandiser: store that stocks a wider
line of goods than a department store, usually
without the same depth of assortment within each
line
 Supercenters: Large stores, though still smaller
than hypermarkets, that combine discount store
merchandise and groceries
 Off-price retailers: Stores that find exceptional
deals on well-known, brand-name clothing and
resells them at low prices
 Classification of Retailers by Form of Ownership
 Chain stores: Groups of stores that operate under
central ownership and management and sell
essentially the same product lines
 Chain stores have the advantages of purchasing and
advertising economies of scale
 Independent Retailers: account for about 43%
of all retail sales
 Advantage of friendly, personalized service
 Cooperatives: Groups of independent retailers
who band together to increase buying and
advertising power
 Ace Hardware
 Cooperatives like
Ace help
independent
retailers compete
with chains
 Classification by Shopping Effort:
Classification system based on the reasons why
consumers shop at particular retail outlets
 Retail stores can be classified as:
 Convenience
 Shopping
 Specialty
 Classifying by Services Provided: This
classification system consists of three retailer
types:
 Self-service Store (e.g., Kmart)
 Self-selection Store (e.g., Winn-Dixie or
Kroger grocery stores)
 Full-service Retailers (e.g., Dillard’s or Macy’s)