EMBA 550 MArketing initial post week 6 Essay Example | Topics and Well Written Essays - 500 words

EMBA 550 MArketing initial post week 6 - Essay Example arious markets that current or traditional channels do not fully explore, supply chain strategy often necessitates the establishment of new and multiple channels. â€Å"The use of multiple channels may arise out of necessity in order to meet customer needs or by design. Multiple channels enable a manufacturer to offer two or more lines of the same merchandise through two or more means.† (Ferrel & Hartline, 2010, p. 283). The use of two or more distribution channels for essentially the same product is what constitutes dual distribution. There are some disadvantages that are attendant to dual or multiple distribution. One is that extra time, effort and money are required in running two or more distribution channels. Another is the risk of disintermediation, meaning that when the corporation deals directly with the customer, they compete against their traditional intermediaries who are members of its supply chain, thereby creating a potential source of conflict (Ferrel & Hartline, 2011). Sometimes, customers who go to brick-and-mortar distributors to view the products and ask questions, but end up purchasing the product online. This is unfair for the distributors. Dual distribution is not new. The U.S. Congress cited the New York Times (2/16/92, Section F, p. 5) which reported that 20% of McDonald’s stores are company operated, and for Taco Bell it is 60% (US Congress, 1992, p. 273). Hallmark uses dual distribution extensively. Hallmark cards primarily sell greeting cards through Hallmark stores, using selective distribution. At the same time, they also sell their Ambassador and Greetings card lines widely through supermarkets, drugstores, and discount retailers. Aside from these, Hallmark offers both cards and e-cards online, which constitutes a third channel (Ferrel & Hartline, 2011) Small businesses benefit immensely from dual distribution. Chagrin Shoe Leather & Luggage Repair, a family business located in Woodmere, Ohio, experienced a 20% increase in