Q6- A distributor should stock as many brands as possible for each product category demanded by its clients." Debate this statement.
Distributors fulfil a number of core roles of their customers. They always want to be a one-stop shop. The customer expects to be able to go to the distributor for anything and buy it without needing to wait or to place it on back order. The distributor’s core role is the ability to provide products (with a range of brands) on demand thus saving or minimizing the stocking burden on the part of its consumers (Dent 2011). Category management has become a popular retail practice where pricing, assortment, and stocking decisions are coordinated across products within a particular retail category. An alternative form of category management called vendor- specific category management (VSCM) where each vendor has the responsibility of managing the stocking and assortment decisions for its own shelf space provided by the retailer. The retailer benefits from the vendors who are experts in their particular product category when they make shelf space management recommendations. Various merits and demerits underlie the reason why a distributor should stock as many brands as possible for each product category demanded by its clients (kumar 2009).
There is no doubt distribution causes market share. The unavailability of products in the market makes it impossible for anyone to buy. Customers have more opportunity for buying more available products for the case of convenience goods. An exception in this case would be in a situation where brand level loyalty is highly experienced. When the product is unavailable, the customers refrain from buying until the product is available. Sales are normally lost to the available brands when there is no brand loyalty or the product is unavailable (Kumar 2009). Sales are also lost by the distributor when brand loyal seek the brand in another stall in the situation where it is missing in the current stall. The added distribution thus provides access to the customers which prefer the brand and also access to other customers of those brands that are unavailable. If a given brand is either temporarily out of stock or not carried by a particular store (not in distribution), those consumers who are not willing to compromise will buy another brand of the same product category in the short run. They will sometime seek the preferred missing brand in another store (Ashville 2009).
Consumers use an extensive range of evaluation criteria to compare products and brands. The use of price as an evaluation criterion varies across product categories. Typically, price is not used in isolation but rather is one of a mix of evaluative criteria. For most consumers and many buying situations, price is the most significant influence in brand or product alternative evaluation. Usually, consumers do not think in terms of a specific, fixed price they are willing to pay for a specific product, but in terms of...