The Marketing Environment

An organisation’s distribution strategy is often interconnected with its promotional strategy. As figure 9.1 illustrates, the distribution system can be depicted as a channel through which products and services move from producer to end user. If the agribusiness concerned believes that its product can be meaningfully differentiated from others on the market, then it may elect to direct the greater part of its promotional effort towards end users.

49) Which of the following is a geographic shift that has been observed in Canada in recent times? A) Central and western Canada experienced growth far short of the national average. B) More Canadians are moving to micropolitan or suburban areas where they can telecommute.

Finally, intermediaries, or middlemen, offer superior efficiency in making goods and services widely available and accessible to final users. For instance, in overseas markets it may be difficult for an exporter to establish contact with end users, and various kinds of agents must therefore be employed. The channel design is based on the level of service desired by the target consumer.

Arguably, brokers perform only two functions, i.e. selling and market intelligence. However, their existence does extend the level of competition in the system. The low level of services offered by brokers perhaps explains why 80% of the farmer’s trade in small ruminants is through traders5. In other words, those functions have to be carried out by someone and the expense and risk of doing so has to be met. Furthermore, intermediaries can only be justified if they can perform these functions more efficiently and effectively than the other actual or potential market participants.

The customer’s perceived value is also impacted by the production process of the next member of the value chain (the customer’s customer). In this case we assume that the industrial customer is customer-oriented and has a good understanding of its customer requirements. Supply is the quantity of goods or services producers are willing to sell at a certain price, in a certain market at a certain time. Like demand, supply is directly dependent upon the price that can be obtained in the marketplace. Because of the new situation producers must be more interested in future supply as well as the behavior of competitors. The only difference between paper and wood industries is that the information regarding distribution systems is more important for the wood industry.

Which of the following is most likely true about business legislation? A) Business laws are enforced only in international markets and not in local markets. B) Business laws fail to while driving in the city the busy urban environment prevent unfair competition among the different companies in a market and tend to encourage monopolies. D) Local, national, and state business laws rarely overlap with one another.

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