4. How are distribution channels usually organized?

Distribution (or placement) is one of the four aspects of marketing. A distributor is the middleman between the manufacturer and retailer. After a product is manufactured it may be warehoused or shipped to the next echelon in the supply chain, typically either a distributor, retailer or consumer.

A number of alternate 'channels' of distribution may be available:

· Selling direct, such as via mail order, Internet and telephone sales

· Agent, who typically sells direct on behalf of the producer

· Distributor (also called wholesaler), who sells to retailers

· Retailer (also called dealer or reseller), who sells to end customers

· Advertisement typically used for consumer goods

Distribution channels can thus have a number of levels. Kotler defined the simplest level, that of direct contact with no intermediaries involved, as the 'zero-level' channel.

The next level, the 'one-level' channel, features just one intermediary between producer and customer - a retailer. In small markets (such as small countries) it is practical to reach the whole market using just one- and zero-level channels. In large markets (such as larger countries) a second level, a wholesaler for example, is now mainly used to extend distribution to the large number of small, neighborhood retailers.

Unit 2 TRAVEL

1. How do airline companies stimulate regular business travelers to stay their loyal customers?

The airlines are now very prominent in the tourist industry and it is important to remember that there are two kinds of airline operations, scheduled and nonscheduled. A scheduled airline operates on fixed routes at fixed times according to a timetable that is available to the public.

A nonscheduled airline operates on routes at a time when there is a demand for the service. The nonscheduled airline is, in other words a charter operation that rents an aircraft. The competition between the two has been very tense.

As seating capacity increased with introduction of newer, larger and faster planes, the airlines were able to offer a percentage of their seats for sale through travel agents or tour operators. They introduced special fares and by means of these special fares, they were able to increase their business substantially. The greatest growth in tourism began with the introduction of these ITX fares, as they are called, in 1950’s and 1960’s.

The nonscheduled airlines got a start largely as a result of government business. In addition to transporting supplies or military personnel, the nonscheduled airlines chartered (rented) entire flights to groups that were traveling to the same destination – businessmen and their wives attending a convention, for example, members of a music society attending the Festival.

Charter inclusive tours were sold at even lover fares than the inclusive tours on scheduled airlines. All transportation is subject to regulation by government, but the airlines are among the most completely regulated of all carriers. The routes they can fly, the number of flights and many other matters are controlled by means of bilateral agreements between different countries in the case of international airlines.