Hait George Valentin

Grupa 904, Seria A

Rei

Distribution policy
(Case study General Motors)

I chose this topic, namely distribution policy because I believe in a company, this policy is a very
important and decisive for the activity of that company.
Policy distribution represents all economic and technical decisions that lead to efficient conduct
of the activities required and the relationships established between operators for release of goods
to the users physical, and distribution refers to the physical and economic circuit of goods, the
system of relations that occur between agents on the market for large masses and different units
of multiple economic sectors.
Maine Source: Danciu, Victor, Marketing strategic competitive , Editura Economica, Bucureti,
2003


Chapter I
Distribution policy
1. Concept of distribution
Distribution concept refers primarily to 'route' that you go through the goods market, to reach
consumers: producers, entrepreneurs and consumers. Participation in successive movement of
goods along this route up what in marketing terminology is called 'distribution channel'.
Analyzed concept refers Secondly, in all the operations (selling, buying, leasing, etc..) by which
the transfer of property rights on goods from one market to another agent until their final entry in
the sphere of consumption . It also include "Chain operative processes to goods in their route to
the consumer, ie the physical distribution of goods."
The concept distribution means, the third, the technical device - network facilities, equipment,
personnel - also performing processes and operations.
Through distribution policy aims to create all conditions to easier for users to find products
needed in accessible at the appropriate time in sufficient quantity and of appropriate quality."The
distribution must meet the appropriate product realization conditions under which enterprises
operate in the market, taking into account the nature of products, consumption structure, existing
in areas of consumption habits, the specific situation of the development production and
marketing in certain periods. "
2. The content and distribution role
Leading commodity, their physical movement is preceded, accompanied or followed by other
streams linking the participants in the distribution assembly.
The main function of the distribution of the process are:
a. change of ownership of the product through the sale and purchase;
b. moving product and the transportation, storage, conditioning, handling, packaging, etc..
c. selection and use of distribution channels.
Activity distribution occurs with the production of goods, has grown through since the Industrial
Revolution, becoming today one of the most dynamic activities.
Distribution fulfills an important economic role. Through distribution, economic activity is
completed firms and end the cycle of products. Distribution fulfills an important economic role.
Through distribution, economic activity is completed firms and end the cycle of products.
Producing enterprise/commercial recovers in cash resources invested in the
production/marketing of products, together with a profit for the activity and the consumer/user is
in possession of the goods required.
Distribution has become one of the keys to developing effective marketing mix: the consistency of
decisions regarding price, product, communication, promotion, service, selection and formula
distribution channel is one of the key aspects of trade policy.
Distribution process: Prospecting-> Offers-> Design and tender-> Sales Order-> Billing in
advance-> Order suppliers-> Front goods and reserves the command client->
Assembly/Composition/Production-> Reversing advance and Billing final-> Delivery goods->
ancillary Services.

Chapter II
Distribution channel
The distribution channel is an organized network of agencies and institutions conducting
activities designed to make the connection between producers and consumers or in other words,
traveling the product from the place of production to the place of consume.
1. Objectives distribution channel
Distribution policy aims to orient both by the final beneficiary and as associated businesses.
These should be divided into three areas:
a. objectives of distribution oriented economic: quantity of sale; turnovers; contributions
cover; market share; fixing the price level and distribution costs.
b. objective of distribution oriented to supply : the degree distribution (number,
weighted); advice attitude of trade(the stock avaible); delivery time; Delivery availability
and reliability of delivery.
c. psychologically oriented distribution objectives: image distribution channel;
counseling qualifications; availability of trade cooperation.
Distribution objectives listed here can have both strategic importance (ex: image distribution
channel) and operational importance (ex: short-term growth in turnover).
Distribution channel is synonymous with marketing channel, thanks to complexity of the role of
the distribution channel, which is not only the movement of goods from producer to consumer,
this engaging intermediates to create value that a buyer looking for. Intermediaries perform
multiple functions related to the distribution: transactional functions (purchase, sale, assuming
the risks of ownership of assets), logistic functions (concentration goods from various sources in
one place, storage, sorting, transport), functions to facilitate the sale - purchase (financial
facilities, classifying various qualities of products, market research, etc.).
Marketing channel can be characterized by three dimensions: length, width and depth:
a. Channel length is given by the completion of a product between the producer and the
final consumer. Depending on the number of these waypoints, distribution channels
include: direct channels without intermediaries; short channel single intermediary; long
channels with two or more intermediaries. The effectiveness of a marketing channel does
not depend on its length but how its duties and the quality of services provided by
intermediaries.
b. Channel width is defined by the number of intermediaries that provide services of the
same nature, which can provide distribution of travel within each phase of the product to
the consumer.
c. Channel depth expresses the closeness of the last places distributor of actual
consumption or use of a product or service.


2. Types of distribution channels
Distribution channels can be organized in several complex distribution systems (marketing
systems):
a. Vertical distribution system, which is controlled by the manufacturer, wholesaler or
retailer who wants to avoid conflicts within the distribution channel through central
planning.
b. Horizontal marketing system requires that two or more enterprises in different industries
to meet the material, financial and human resources to capitalize on market opportunity
or to cover more than one market segment.
c. The multi-channel marketing that brings producers three advantages: better market
coverage; lower distribution costs; "personalization" higher sales process.
Regardless of the chosen method of distribution, and efforts to design an effective marketing
channel conflicts always occur between channel members, often because their goals do not
coincide:
the vertical channels - contradictions arise between the different rings of the channel;
for horizontal channels - conflicts between the links of the same type thereof;
the multi-channel distribution system - conflicts are caused by competition that occurs
between the channels trying to meet the same consumer segment;

The easiest way to maintain control of the conflict is to try to harmonize different targets
members of a distribution channel.

Chapter III
Distribution strategies
In general, there are three policy options:
1. Intensive distribution involves distributing products and services through a large
number of retail units. It is the best way of distribution for consumer goods, consumer
services (banking, transportation, life insurance) and some industrial goods;
2. Selective distribution is used by businesses that produce goods for the buyers prefer to
spend more time to acquire them even in specialized retail units (bicycles, equipment).
This strategy enables manufacturers to achieve better control and lower costs of
distribution and work only with certain intermediaries selected for this purpose;
3. Exclusive distribution- used by producers who wish to retain control over the
distribution of their products, following a good picture of these products and high
commercial additions. It is common in passenger cars class electronics, clothing brand.
Distribution strategies represent an option, a set of options. Distribution strategies cover a
wide range, which concerns the choice of channels, choice of forms of distribution,
participation in the distribution of the firm, the degree of control the distribution, the
degree of elasticity of the apparatus of distribution activities, goods logistics.

Chapter IV
Case study of General Motors
1. General presentation
General Motors was founded in 1908 by WC Durant, who along with Henry Ford founded the
automotive industry in America and beyond. The car has provided one of the greatest
opportunities of our time in Indutrial and General Motors had the chance to be the basis of this
foundation.
Oraganizare mode is characterized by perfect coordination GM policies and government
decentralization.
2. Theoretical elements
International distribution represents the activities taking place and the relationships established
between partners in different markets conditions for release of goods to consumers or foreign
users.
International distribution intermediaries is limited by the fact that due to their interposition
between producers and foreign consumers may be problems related to the negotiation and
conclusion of transactions and efficiency of information transmission manufacturer market,
which could affect its ability to adapt to the demands of international markets . Intermediaries
involved in indirect international distribution can be divided into the following categories:
international members channel (international middlemen) and distribution channel members
Independence from external markets (local).
International distribution channel is the 'route' on moving goods from producer to consumers
or users in international markets.
Exclusive distribution involves using a single intermediary specialized for a particular market.
This option is used mainly for marketing products with high unit value, well individualized and
considered the brand as automobiles, tractors, crystals, jewelry.
Franchising provides presence in international markets by giving know-how in the field of
distribution operators in local markets. Multinational strategy consists in opening branches
abroad, where distribution formula is adapted to local conditions. Multinational companies
combine standardization concept differentiation as it considers subsidiaries as having
differentiated, tailored to the local markets.
3. Distribution Policy
General Motors used primarily as distributors, dealers. For this company a stable distribution
system consists of dealers is a necessary condition for progress and stability. Dealer of General
Motors (GM) is a franchisee. So GM uses as development strategy franchise. Franchising is
essentially a contractual arrangement whereby a company (franchisor company) GM granted to
other companies (francizt beneficiary) dealer, business permission to use intellectual property
rights and materials belonging to the transferor in exchange for payments as taxes, royalties,
etc...
Dealer undertakes to provide capital for business space, an adequate number of sales agents,
mechanical service, have in stock and sell parts, and so on. Instead, the manufacturer sells almost
entirely through franchised dealer.
As GM market coverage strategy uses exclusive distribution and the geographical strategy,
multinational strategy. To penetrate the market more efficiently divided cities with a population
greater than 1 million areas to determine potential consumers, especially in the United States.
Policy in the distribution system of GM, which has pioneered when it was introduced, remember
setting up a special division, Motors Holding Division, which has the function to provide capital
to dealers through this acted as a shareholder. It is also a funding body by financial problems
saves dealers from bankruptcy.
Another policy, less common at the time it was enacted, the dealer gave him the opportunity to
have a grievance or complaint filed to address directly the top management, executives. If the
dealer is not effective, it is removed from the distribution system. In this policy applies which
includes the following arrangements: the corporation will take back from the dealer, the price at
which he has purchased all new cars he owns; also parts; signs and advertising media company.
In fact he is able to sell the goods but not the franchise.
All these policies have ensured GM implantation efficient distribution system, which provided
marketing its products to high standards.
Conclusions
Modern distribution developed at the expense of traditional trade, producing a concentration of
industry in all countries and major groups capturing considerable market share, basically
assisting the internationalization of distribution companies.
Very few manufacturers distribute directly to end customers, generally resorting to specialized
distributors.
Through distribution, economic activity is completed firms and end the cycle of products.
In the modern economy, production and consumption are not practicable without the presence
of distribution.
In the achievement link between producer and consumer, intermediaries contribution is not
limited to a passive role.
References :
1. Danciu, Victor , Marketing strategic competitiv , Editura Economica, Bucureti, 2003

2. Dorobanu, Horia ; Cucui, Ion, Managementul distribuiei marfurilor, Editura Macarie,
Trgovite, 1995

3. Iftimie, Silvia , Strategii logice n marea distribuie n Revista de comer , v. 6, nr. 6,
2005

4. Patriche, Iulia, Circuitele de distribuie specifice ale bunurilor i serviciilor n Revista
de comer, v.8, nr. 8, 2007


5. Sabou, Felicia , Distribuia produselor : strategii n Revista de comer, v. 5, nr. 10,
octombrie 2004


6. WWW.GENERALMOTORS.COM