3. Full Chain of Distribution

This tends to be used when the producer makes a limited range of products, storage costs are high and the product is perishable.

4. No Wholesaler

The wholesaler is eliminated in industries where the producer makes a number of standard products that it sells to similar kinds of retail outlets. Frozen-food firms and large bakeries tend to have their own distribution network and their own fleet of delivery lorries.

5. No Retailer

There has been a growth in the case of wholesalers, which sell directly to the general public. These large discount stores sell furniture and other household products in warehouses style buildings with relatively poor customer facilities. Mail order companies such as Great Universal Stores, where local selling agents run a catalogue for orders, are a good example of distribution without a retailer. These local agents work on a commission basis and deal with the ordering of goods and the means of payment.

6. Direct Selling

Direct selling to the customer is typically found in the sale of service, e.g. insurance and double glazing. In the case of industrial products such as chemicals and manufacturing machines, firms generally employ a full-time sales force to try and sell products to other firms. Such sales teams may be organized on a regional basis, with specific areas of the country to cover, e.g. North West, East Midlands and South Wales. The sales team is a very important part of the marketing function. Although its major role is to sell the company’s product, it may also be source of important market research information, e.g. salesmen can find out customers’ reactions to products and can find out their future requirements. They can also find out what competitors are doing and supply this information back to the company. The sales team may be the first link that a customer has with the company, and so the presentation of a good image may be important.

7. Retailing Outlets

There are various retail outlets through which manufacturer can decide to sell a product. In 1984, it was estimated that there were 343, 153 outlets controlled by 230,787 organizations – which indicates that the vast majority are “one-shop” operation.

Exercises

Ex.9. Find where in the text it is said about the points given below. Put down the number of the paragraph:

1. the meaning of the term “ distribution” in the business context

2. the main idea of full-chain distribution channel

3. the main idea of no wholesaler distribution channel

4. the main idea of no retailer distribution channel

5. the notion of direct selling

Ex.10. Say if the following statements are true or false:

1. The term “distribution” is referred to the physical distribution of goods from the producer to the consumer.

2. Most consumer products are usually distributed through retail organizations.

3. Full chain of distribution offers advantages and disadvantages to both the manufacturer and retailer.

4. Some industries have cut the “middle-man” (wholesaler), and the manufacturer sells directly to the consumer.

5. Full chain of distribution is used when the producer makes a limited range of products, storage costs are high and the product is perishable.

6. The wholesaler is included in industries where the producer makes a number of standard products in no wholesaler distribution channel.

7. In distribution no retailer local agents work on a commission basis and deal with the ordering of goods and the means of payment.

8. Direct selling to the customer is typically found in the sale of commodities.

9. The sales team is a very important part of the marketing function in direct selling.

10. Manufacturer can buy a product through various retail outlets.

Ex. 11. Find the answers to the questions in the text. Put down the number of the paragraph:

1. What does distribution channel mean?

2. How are many industrial products and services sold?

3. How are most consumer products distributed?

4. What advantages/disadvantages does full chain of distribution

offer both to the manufacturer and retailer?

5. In what case is the full chain of distribution used?

6. Why is the wholesaler eliminated in no wholesaler distribution channel?

7. Why has there been a growth in the case of wholesalers in no retailer distribution channel?

8. What sales is direct selling found?

9. How may sales teams be organized?

10.What are the main functions of a sales team?

11. How many retail outlets were controlled by many organizations in 1984?

Ex. 12. Make up a plan covering the main ideas. Discuss the text according to the plan.

Варіант 5

Text 1. Bank Investment

Exercise 1. Read and memorize the following words, words combinations and word-groups:

To commit – вкладати, залучати ресурси у виробництво;

Real estate – нерухомість;

Bond –облігація;

investment option – інвестиційний вибір

Assets - активи

Yield – прибуток у вигляді відсотків на вкладений капітал;

Consequences – наслідки;

To affect - впливати

Reconciliation – узгодження;

Available - наявний

Withdrawal – відкликання коштів, знімання (з рахунку);

Rate of return – норма прибутку

to meet demands – відповідати вимогам

caution – пересторога, запобіжний захід

at short notice – з короткотерміновим повідомленням

to account – складати

medium term - середньострокові

saleable – ті, що можуть бути продані

investment portfolio – портфель цінних паперів

working capital-оборотні кошти

advance - позика

overdraft -перевищення кредиту, овердрафт

to regard oneself – позиціонуватись, вважати себе.

Exercise 2. Read and translate the whole text with a dictionary orally. Translate paragraphs 1,2, 3 in writing. Do exercises after the text.

1. Broadly speaking, investing means committing capital with the expectation of making a profit. The first step in any investment program is for the investor to analyze specific situation. The analysis will contain specifics in terms of income desired, cash requirements, level of risk, and so forth. A second step is to select general investment options that best fit the specific needs of the investor. For example, investors should decide how much, if any, of their assets (economic resources) should be committed to real estate, bonds or stocks. The third step is to select specific investments within the general areas. Generally, there are five criteria to use when selecting an investment option:

1. Investment risk – the chance that an investment and all its accumulated yields will be worth less at some future time than when the investment is made.

3. Yield – the increase in the value of an investment over time, usually a year.

4. Duration – the length of time assets are committed.

5. Liquidity – how quickly one can get back invested funds when desired.

6. Tax consequences – how the investment will affect the investor`s tax situation.

2. The investment policy of a bank is based upon the reconciliation of two conflicting aims. On the one hand the bank wants to make as much profit as it can and for this reason it must take the risks of lending money. On the other hand its funds belong to its depositors and must be available whenever they wish to make withdrawals i.e. take their money back from a bank`s assets.

3. There are two things that the bank must therefore do. First, it must keep a proportion of its assets in the form of cash to meet demands. The amount that this needs to be varies very little from one bank to another or from one day to another and experience suggests that it is about six percent. As a caution against unexpected demands a further proportion of funds is invested at low rates of return in any liquid lending mostly to firms in the money and capital markets.

4. The second thing that the banks must do is to ensure that the investments it chooses are safe. This also means that they are relatively low yielding since high yields are associated with risks and with lending for long periods of time. Much of bank`s investment is in short and medium term government and local government bonds. They yield certain incomes and are readily saleable should the occasion demand.

5. Advances by a bank to its customers are the least liquid of their assets since there are few borrowers who could repay a loan at very short notice. However, they are also the most profitable of them yielding the highest rate of return advances to customers are likely to account for more than two thirds of the banks investment portfolio although this will vary on a day-to-day basis since overdrafts are the most common form of advance and are not immediately controllable by the bank.

6. In general, banks do not lend to industry for long periods of time or for investment projects. They regard themselves as providing working capital rather then the fixed capital.