| Middleman | A business firm that renders services directly related to the purchase and/or sale of a product as it flows from producer to consumer.
|
 |
|
|
| Merchant middleman | A firm that actually takes title to (i.e., owns) products it helps to market.
|
|
|
|
| Agent middleman | A firm that never actually takes title to (i.e., owns) products it helps market but does arrange the transfer of title.
|
|
|
|
| Disintermediation | The replacement of some traditional intermediaries in a process due to the growth of Internetbased sales.
|
|
|
|
| Distribution channel | The set of people and firms involved in the transfer of title to a product as the product moves from producer to ultimate consumer or business user.
|
|
|
|
| Gray marketing | Practice of buying a product in one country, agreeing to distribute it in a second country but diverting it to a third country. Also called export diversion.
|
|
|
|
| Direct distribution | A channel consisting only of producer and final customer, with no middlemen providing assistance.
|
|
|
|
| Indirect distribution | A channel consisting of producer, final customer, and at least one level of middlemen.
|
|
|
|
| Multiple distribution channels | The use by a producer of more than one channel of distribution for reasons such as achieving broad market coverage or avoiding total dependence on a single arrangement.
|
|
|
|
| Vertical marketing system (VMS) | A tightly coordinated distribution channel designed to improve operating efficiency and marketing effectiveness.
|
|
|
|
| Corporate vertical marketing system | An arrangement under which a firm at one level of a distribution channel owns the firms at the next level or owns the entire channel.
|
|
|
|
| Contractual vertical marketing system | An arrangement under which independent firms-producers, wholesalers, and retailers-operate under contracts specifying how they will operate in order to improve their distribution efficiency and effectiveness.
|
|
|
|
| Administered vertical marketing system | An arrangement that coordinates distribution activities through the market and/or economic power of one channel member or the shared power of two channel members.
|
|
|
|
| Intensity of distribution | The number of middlemen used by a producer at the retail and wholesale levels in a particular territory.
|
|
|
|
| Intensive distribution | A strategy in which a producer sells its product through every available outlet in a market where a consumer might reasonably look for it.
|
|
|
|
| Selective distribution | A strategy in which a producer sells its product through multiple, but not all possible, wholesalers and retailers in a market where a consumer might reasonably look for it.
|
|
|
|
| Exclusive distribution | A strategy in which a supplier agrees to sell its product only to a single wholesaling middleman and/or retailer in a given market.
|
|
|
|
| Channel conflict | A situation in which one channel member perceives another channel member to be acting in a way that prevents the first member from achieving its distribution objectives.
|
|
|
|
| Chargeback | A penalty that a retailer or wholesaler assesses to a vendor that actually or allegedly violates an agreed upon distribution policy or procedure.
|
|
|
|
| Horizontal conflict | A form of channel conflict occurring among middlemen (either of the same type or different types) at the same level of distribution.
|
|
|
|
| Scrambled merchandising | The main source of horizontal channel conflict, a strategy under which a middleman diversifies by adding product lines not traditionally carried by its type of business.
|
|
|
|
| Vertical conflict | A form of channel conflict occurring among firms at different levels of the same channel, typically producer versus wholesaler or producer versus retailer.
|
|
|
|
| Slotting allowance | A fee that some retailers charge a manufacturer in order to place its product on store shelves.
|
|
|
|
| Channel control | The actions of a firm to regulate the behavior of other companies in its distribution channel.
|
|
|
|
| Channel power | The ability of a firm to influence or determine the behavior of another channel member.
|
|
|
|
| Category management | A distribution practice in which a retailer allows a large supplier to manage an entire product category in a store or chain, with the supplier deciding which items will be placed on a retailer's shelves and in what quantities and locations.
|
|
|
|
| Exclusive dealing | The practice by which a manufacturer prohibits its dealers from carrying products of its competitors.
|
|
|
|
| Tying contract | The practice by which a manufacturer sells a product to a middleman only under the condition that the middleman also buy another (possibly unwanted) product from the manufacturer.
|
|
|
|
| Refusal to deal | A situation in which a producer that desires to select and perhaps control its channels declines to sell to some middlemen.
|
|
|
|
| Exclusive-territory policy | The practice by which a producer requires each middleman to sell only to customers located within an assigned territory.
|