Classifying Services

Services can be classified as either consumer or industrial. Child-care centers and shoe repair shops provide services for consumers, while the Pinkerton security patrol at a factory and Kelly Services' temporary office workers are examples of industrial service

To remain competitive, marketers look for gaps in their assortment and fill them with new products or modified versions of existing ones. A helpful tool used by marketers in making product decisions is the product life cycle.

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Channels of Distribution

All the activities which play a part in moving goods from producers to consumers are included in distribution.

The Chain of Distribution

The traditional method of distribution is for producers to supply goods in bulk to independent wholesalers, who hold stocks and distribute relatively small quantities to individual retailers.

The Wholesale Trade

The wholesale stage is a most important link in the chain of distribution. The wholesaler helps to solve the basic problem оf distribution.

To overcome this problem, wholesalers provide a number of important services.

Breaking bulk. Wholesalers buy large quantities from a variety of producers and divide these into smaller quantities for distribution to retailers.

Holding stocks. Consumers usually expect to be able to purchase a commodity when they need it. By holding large stocks wholesalers make it possible for retailers to obtain suppliers when they require them

Information. The wholesaler's warehouse is an important source of information to retailers. They can visit the warehouse and inspect the range of goods available.

The Retail Trade

Retailers are the last link in the chain of distribution. They provide the following services:

1. They make a variety of goods available in locations convenient to the consumer.

2. They perform an important advertising function for producers.

3. For products of a technical nature, they offer after-sales services.

Independent retailers are usually sole traders or "one-shop" firms. Multiple shops. These are shops which belong to chains of very similar stores that are owned by large companies.

Organizations which own multiple stores are usually successful because they have the following features:

1. they buy in large quantities and obtain their goods at lower prices,

2. they employ specialist buyers and marketing experts;

3. they market their own brands;

4. they exercise close control over their shops from "head office".

Department stores. In fact, a department store consists of several special shops under one roof. They have a wide range of goods which are sold in special departments.

Supermarkets. A supermarket is defined as a self-service food store with a sales area of more than 190 square meters. These very large self-service stores are usually located on the outskirts of towns.

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