{"id":3218,"date":"2023-02-19T16:12:02","date_gmt":"2023-02-19T16:12:02","guid":{"rendered":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/chapter\/apply-it-15-3-place\/"},"modified":"2023-07-23T17:02:48","modified_gmt":"2023-07-23T17:02:48","slug":"apply-it-15-3-place","status":"publish","type":"chapter","link":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/chapter\/apply-it-15-3-place\/","title":{"raw":"Apply It 15.3: Place","rendered":"Apply It 15.3: Place"},"content":{"raw":"<section class=\"textbox learningGoals\">\r\n<ul>\r\n \t<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;List the characteristics and flows of a distribution channel&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">List the characteristics and flows of a distribution channel<\/span><\/li>\r\n \t<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Understand what channel partners are and how they support distribution channels&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Understand what channel partners are and how they support distribution channels<\/span><\/li>\r\n \t<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Understand what a wholesale intermediary is&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Understand what a wholesale intermediary is<\/span><\/li>\r\n \t<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Recognize different types of retailers&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Recognize different types of retailers<\/span><\/li>\r\n \t<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Understand the difference between supply chains and distribution channels&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Understand the difference between supply chains and distribution channels<\/span><\/li>\r\n<\/ul>\r\n<\/section>\r\n<h3>Monster Channel\u00a0Flow<\/h3>\r\nThe figure below maps the channel flows for the Monster Energy drink (and many other energy drink brands). Why is Monster\u2019s relationship with Coca-Cola so valuable?\r\n[reveal-answer q=\"952364\"]Click to Show Sample Answer[\/reveal-answer]\r\n[hidden-answer a=\"952364\"]Every single flow passes through bottlers and distributors in order to arrive in supermarkets where the product will be available to consumers. Coca-Cola explains the importance of the bottlers in the distribution network:\r\n<blockquote>\r\n<div>\r\n\r\nWhile many view our Company as simply \u201cCoca-Cola,\u201d our system operates through multiple local channels. Our Company manufactures and sells concentrates, beverage bases and syrups to bottling operations, owns the brands and is responsible for consumer brand marketing initiatives. Our bottling partners manufacture, package, merchandise and distribute the final branded beverages to our customers and vending partners, who then sell our products to consumers.\r\n\r\nAll bottling partners work closely with customers \u2014 grocery stores, restaurants, street vendors, convenience stores, movie theaters and amusement parks, among many others \u2014 to execute localized strategies developed in partnership with our Company. Customers then sell our products to consumers at a rate of more than 1.9 billion servings a day.[footnote]\"The Coca-Cola System.\" The Coca-Cola Company. Accessed June 25, 2019. <a href=\"http:\/\/www.coca-colacompany.com\/our-company\/the-coca-cola-system\/\" target=\"_blank\" rel=\"noopener\">http:\/\/www.coca-colacompany.com\/our-company\/the-coca-cola-system\/<\/a>[\/footnote]\r\n\r\n<\/div><\/blockquote>\r\nRevisiting the channel flows we find that the bottlers and distributors play a role in each flow. Examples of the flows are listed below. Remember, while the consumer is the individual who eventually consumes the drink, the supermarkets, restaurants, and other outlets are Coca-Cola\u2019s customers.\r\n<ul>\r\n \t<li>Product flow: the\u00a0bottlers receive and process the bases and syrups<\/li>\r\n \t<li>Negotiation flow: the\u00a0bottlers buy concentrate, sell product and collect\u00a0revenue from\u00a0customers<\/li>\r\n \t<li>Ownership flow: distributors acquire\u00a0the title of the syrups and own the product until it\u2019s sold to supermarkets<\/li>\r\n \t<li>Information flow: bottlers communicate product options to customers and communicate demand and needs to Coca-Cola<\/li>\r\n \t<li>Promotion flow: bottlers communicate benefits and provide promotional materials to customers<\/li>\r\n<\/ul>\r\n[\/hidden-answer]\r\n\r\n<img class=\"aligncenter wp-image-14033 size-full\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/3006\/2016\/09\/21181056\/IMG_FiveFlows.png\" alt=\"Five Flows in the Marketing Channel for Monster Beverages. The chart consists of five flow-charts titled: Product Flow, Negotiation Flow, Ownership Flow, Information Flow, and Promotion Flow. Product Flow consists of: Manufacturer flows to transportation company flows to public warehouse flows to transportation company flows to bottlers and distributors flows to supermarkets flows to consumers. Negotiation flow consists of: Manufacturer flows to bottlers and distributors flows to supermarkets flows to consumers, and consumers flow to supermarkets. Ownership flow consists of: Manufacturer flows to bottlers and distributors flows to supermarkets flows to consumers, and consumers flow to supermarkets. Information flow consists of: A two way flow between manufacturers and transportation company, a two way flow between the transportation company and the public warehouse, a two way flow between the public warehouse and the transportation company, a two way flow between the transportation company and the bottles and distributors, a two way flow between the bottlers and distributors and the supermarkets, and a two way flow between the supermarkets and the consumers. The manufacturers also flow directly to the bottlers and distributors, supermarkets, and consumers. Promotion flow consists of: Manufacturer flows to four places: advertising agency, bottlers and distributors, supermarkets, and consumers. Advertising agency flows to three places: to bottlers and distributors, to supermarkets, and to consumers. Bottlers and distributors flow to two places: to supermarkets and to consumers. Supermarkets flow to consumers. Consumers flow to supermarkets.\" width=\"1001\" height=\"751\" \/>\r\n\r\n&nbsp;","rendered":"<section class=\"textbox learningGoals\">\n<ul>\n<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;List the characteristics and flows of a distribution channel&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">List the characteristics and flows of a distribution channel<\/span><\/li>\n<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Understand what channel partners are and how they support distribution channels&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Understand what channel partners are and how they support distribution channels<\/span><\/li>\n<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Understand what a wholesale intermediary is&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Understand what a wholesale intermediary is<\/span><\/li>\n<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Recognize different types of retailers&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Recognize different types of retailers<\/span><\/li>\n<li><span data-sheets-value=\"{&quot;1&quot;:2,&quot;2&quot;:&quot;Understand the difference between supply chains and distribution channels&quot;}\" data-sheets-userformat=\"{&quot;2&quot;:14720,&quot;10&quot;:0,&quot;11&quot;:4,&quot;14&quot;:{&quot;1&quot;:2,&quot;2&quot;:0},&quot;15&quot;:&quot;Calibri&quot;,&quot;16&quot;:10}\">Understand the difference between supply chains and distribution channels<\/span><\/li>\n<\/ul>\n<\/section>\n<h3>Monster Channel\u00a0Flow<\/h3>\n<p>The figure below maps the channel flows for the Monster Energy drink (and many other energy drink brands). Why is Monster\u2019s relationship with Coca-Cola so valuable?<\/p>\n<div class=\"qa-wrapper\" style=\"display: block\"><button class=\"show-answer show-answer-button collapsed\" data-target=\"q952364\">Click to Show Sample Answer<\/button><\/p>\n<div id=\"q952364\" class=\"hidden-answer\" style=\"display: none\">Every single flow passes through bottlers and distributors in order to arrive in supermarkets where the product will be available to consumers. Coca-Cola explains the importance of the bottlers in the distribution network:<\/p>\n<blockquote>\n<div>\n<p>While many view our Company as simply \u201cCoca-Cola,\u201d our system operates through multiple local channels. Our Company manufactures and sells concentrates, beverage bases and syrups to bottling operations, owns the brands and is responsible for consumer brand marketing initiatives. Our bottling partners manufacture, package, merchandise and distribute the final branded beverages to our customers and vending partners, who then sell our products to consumers.<\/p>\n<p>All bottling partners work closely with customers \u2014 grocery stores, restaurants, street vendors, convenience stores, movie theaters and amusement parks, among many others \u2014 to execute localized strategies developed in partnership with our Company. Customers then sell our products to consumers at a rate of more than 1.9 billion servings a day.<a class=\"footnote\" title=\"&quot;The Coca-Cola System.&quot; The Coca-Cola Company. Accessed June 25, 2019. http:\/\/www.coca-colacompany.com\/our-company\/the-coca-cola-system\/\" id=\"return-footnote-3218-1\" href=\"#footnote-3218-1\" aria-label=\"Footnote 1\"><sup class=\"footnote\">[1]<\/sup><\/a><\/p>\n<\/div>\n<\/blockquote>\n<p>Revisiting the channel flows we find that the bottlers and distributors play a role in each flow. Examples of the flows are listed below. Remember, while the consumer is the individual who eventually consumes the drink, the supermarkets, restaurants, and other outlets are Coca-Cola\u2019s customers.<\/p>\n<ul>\n<li>Product flow: the\u00a0bottlers receive and process the bases and syrups<\/li>\n<li>Negotiation flow: the\u00a0bottlers buy concentrate, sell product and collect\u00a0revenue from\u00a0customers<\/li>\n<li>Ownership flow: distributors acquire\u00a0the title of the syrups and own the product until it\u2019s sold to supermarkets<\/li>\n<li>Information flow: bottlers communicate product options to customers and communicate demand and needs to Coca-Cola<\/li>\n<li>Promotion flow: bottlers communicate benefits and provide promotional materials to customers<\/li>\n<\/ul>\n<\/div>\n<\/div>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-14033 size-full\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/3006\/2016\/09\/21181056\/IMG_FiveFlows.png\" alt=\"Five Flows in the Marketing Channel for Monster Beverages. The chart consists of five flow-charts titled: Product Flow, Negotiation Flow, Ownership Flow, Information Flow, and Promotion Flow. Product Flow consists of: Manufacturer flows to transportation company flows to public warehouse flows to transportation company flows to bottlers and distributors flows to supermarkets flows to consumers. Negotiation flow consists of: Manufacturer flows to bottlers and distributors flows to supermarkets flows to consumers, and consumers flow to supermarkets. Ownership flow consists of: Manufacturer flows to bottlers and distributors flows to supermarkets flows to consumers, and consumers flow to supermarkets. Information flow consists of: A two way flow between manufacturers and transportation company, a two way flow between the transportation company and the public warehouse, a two way flow between the public warehouse and the transportation company, a two way flow between the transportation company and the bottles and distributors, a two way flow between the bottlers and distributors and the supermarkets, and a two way flow between the supermarkets and the consumers. The manufacturers also flow directly to the bottlers and distributors, supermarkets, and consumers. Promotion flow consists of: Manufacturer flows to four places: advertising agency, bottlers and distributors, supermarkets, and consumers. Advertising agency flows to three places: to bottlers and distributors, to supermarkets, and to consumers. Bottlers and distributors flow to two places: to supermarkets and to consumers. Supermarkets flow to consumers. Consumers flow to supermarkets.\" width=\"1001\" height=\"751\" \/><\/p>\n<p>&nbsp;<\/p>\n<hr class=\"before-footnotes clear\" \/><div class=\"footnotes\"><ol><li id=\"footnote-3218-1\">\"The Coca-Cola System.\" The Coca-Cola Company. Accessed June 25, 2019. <a href=\"http:\/\/www.coca-colacompany.com\/our-company\/the-coca-cola-system\/\" target=\"_blank\" rel=\"noopener\">http:\/\/www.coca-colacompany.com\/our-company\/the-coca-cola-system\/<\/a> <a href=\"#return-footnote-3218-1\" class=\"return-footnote\" aria-label=\"Return to footnote 1\">&crarr;<\/a><\/li><\/ol><\/div>","protected":false},"author":21,"menu_order":22,"template":"","meta":{"_candela_citation":"[{\"type\":\"cc\",\"description\":\"Monster Channel Flows\",\"author\":\"\",\"organization\":\"Lumen Learning\",\"url\":\"\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"},{\"type\":\"cc\",\"description\":\"Revision and adaptation of Chapter 10, Chanel Concepts, Distributing the Product, from Introducing Marketing\",\"author\":\"John Burnett\",\"organization\":\"Modifications by Lumen Learning\",\"url\":\"http:\/\/solr.bccampus.ca:8001\/bcc\/file\/ddbe3343-9796-4801-a0cb-7af7b02e3191\/1\/Core%20Concepts%20of%20Marketing.pdf\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"}]","pb_show_title":"on","pb_short_title":"","pb_subtitle":"","pb_authors":[],"pb_section_license":""},"chapter-type":[],"contributor":[],"license":[],"part":3193,"module-header":"apply_it","content_attributions":[{"type":"cc","description":"Monster Channel Flows","author":"","organization":"Lumen Learning","url":"","project":"","license":"cc-by","license_terms":""},{"type":"cc","description":"Revision and adaptation of Chapter 10, Chanel Concepts, Distributing the Product, from Introducing Marketing","author":"John Burnett","organization":"Modifications by Lumen Learning","url":"http:\/\/solr.bccampus.ca:8001\/bcc\/file\/ddbe3343-9796-4801-a0cb-7af7b02e3191\/1\/Core%20Concepts%20of%20Marketing.pdf","project":"","license":"cc-by","license_terms":""}],"internal_book_links":[],"video_content":null,"cc_video_embed_content":{"cc_scripts":"","media_targets":[]},"try_it_collection":null,"_links":{"self":[{"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/pressbooks\/v2\/chapters\/3218"}],"collection":[{"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/pressbooks\/v2\/chapters"}],"about":[{"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/wp\/v2\/types\/chapter"}],"author":[{"embeddable":true,"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/wp\/v2\/users\/21"}],"version-history":[{"count":5,"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/pressbooks\/v2\/chapters\/3218\/revisions"}],"predecessor-version":[{"id":5934,"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/pressbooks\/v2\/chapters\/3218\/revisions\/5934"}],"part":[{"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/pressbooks\/v2\/parts\/3193"}],"metadata":[{"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/pressbooks\/v2\/chapters\/3218\/metadata\/"}],"wp:attachment":[{"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/wp\/v2\/media?parent=3218"}],"wp:term":[{"taxonomy":"chapter-type","embeddable":true,"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/pressbooks\/v2\/chapter-type?post=3218"},{"taxonomy":"contributor","embeddable":true,"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/wp\/v2\/contributor?post=3218"},{"taxonomy":"license","embeddable":true,"href":"https:\/\/content.one.lumenlearning.com\/introductiontobusiness\/wp-json\/wp\/v2\/license?post=3218"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}