Marketing Channel Flows & Channel Conflict

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Marketing Channel Flows & Channel Conflict

Marketing Channels (MKT 450)

Date of Submission: July 14, 2010

School of Business

North South University

MARKETING CHANNEL FLOWS

A channel flow is a set of related functions to perform marketing activity through channel member. The function start from producer and finished by consumers or end users. There are eight generic flows and they are physical possession, ownership, promotion, negotiation, financing, risking, ordering and payment. Each of this flows contribute to the service output generation for the customer so that customer can easily choose or acquire desired product at a nearest possible place in a shortest possible time.

In the channel flows, we can see some components act as a forward flow, some are backward, and some are act in both directions. Physical possession, ownership, and promotion act as forward flow. Ordering and payment play the role of backward flow. Still others such as negotiations, financing, and risk taking occur in both directions in the marketing channel flow. All eight channels flow performing a certain task from their own place. Every flow not only contributes to the production of valued service outputs but also is associated with a cost. First channel flow is Physical possession, which refers how goods will store as well as its transportation between two channel members. For example, manufacturer is delivering the product to the retailer using his own truck.

The second flow is ownership. It refers that this products or goods is one particular channel member until it has been passed to next channel member. For example before delivering the product by truck, manufacturer is the owner of the product. But when the product is received by the retailer, the ownership changes from manufacturer to the retailer. When a channel member became owner of the goods, it bears the cost of carrying the inventory and other costs related to it.

The next flow...