Term
| Channel Member Selection and Channel Design |
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Definition
| Selection decisions are frequently necessary even when channel structure changes have not been made; that is, selection decisions may or may not be the result of channel design decisions. For example, expansion of coverage in existing territories or channel member turnover could create a need for channel member selection. |
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Term
| General rule in channel member selection |
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Definition
| The greater the intensity of distribution, the less emphasis on channel member selection. |
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Term
| Companies using intensive distribution |
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Definition
| These companies usually place their products in every logical outlet in an attempt to blanket the market and make their products universally available. They seldom exercise much discrimination in the selection of resellers (channel members) other than ensuring that their credit is satisfactory. |
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Term
| Firms that emphasize more selective distribution |
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Definition
| For these manufacturers, distributor selection is critical, representing the juncture at which the manufacturer has greatest control and opportunity in the field for ensuring the marketing success of his products which move through resellers. |
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Term
| Three basic steps in the Selection Process |
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Definition
1. Finding prospective channel members
2. Applying certain criteria to determine the suitability of prospective channel members
3. Securing the prospective channel members as actual channel members |
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Term
| Sources for Finding Prospective Channel Members |
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Definition
- Field sales organization
- Trade sources
- Reseller inquiries
- Customers
- Advertising
- Trade shows
- Other sources |
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Term
| Applying Selection Criteria |
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Definition
| If a firm has not developed a set of criteria for use in selecting channel members, it must develop one. |
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Term
| Brendel’s list of 20 key questions for industrial firms to ask their prospective channel members |
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Definition
1. Does the distributor really want our line or is he after it just because of present-day shortages?
2. How well established is he?
3. What is his reputation among his customers
4. What is his reputation among manufacturers?
5. Is he aggressive?
6. What other allied line does the distributor handle?
7. What is the distributor’s financial position?
8. Has he the ability to discount his bills?
9. What is the size of his plant (facilities)?
10. Will he maintain an adequate inventory for services?
11. To what important customers does the distributor sell?
12. To which ones does he not sell?
13. Does the distributor maintain stable prices?
14. Does he give yearly sales figures for the past five years?
15. What territory does the distributor actually cover with salespeople?
16. Are the distributor’s salespeople trained?
17. How many field personnel does he have?
18. How many inside employees?
19. Does the distributor believe in active cooperation, sales training, and sales promotion?
20. What facilities does the distributor have for these activities? |
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Term
| Pegram’s list of channel member selection criteria |
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Definition
1. Credit and financial condition
2. Sales strength
3. Product Lines
4. Reputation
5. Market coverage
6. Sales performance
7. Management succession (ability to continue if owner/founder dies)
8. Management ability
9. Attitude
10. Size |
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Term
| 3. Securing the Channel Members |
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Definition
| The selection process is a two-way street. It is not only the producer or manufacturer who does the selecting, but also the intermediaries at both the wholesale and retail levels. Most producers and manufacturers still need to do an effective selling job to secure the services of good intermediaries. |
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Term
| Specific Inducements for Securing Channel Members |
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Definition
1. good, profitable product line with strong sales and profit potential
2. advertising and promotional support
3. management assistance
4. fair dealing policies and friendly relationships |
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