Name – Munendra Singh Chahar

Roll. No. - 511032000

Center Code- 991

MBA Semester - 3

Assignment Set- 1

Sales, Distribution and Supply Chain Management

Q.1 a. Explain the different types of sales organizations.

Ans.: Different types of Sales Organization

1) Organizing the Sales Force:

An effective sales force is a powerful asset for any company. Doctors & physicians in United
States have consistently ranked Pfizer’s sales force as one of the best in the pharmaceutical
industry. As a result, when Parke-Davis launched its blockbuster cholesterol-lowering drug,
Lipitor, it entered into an alliance in which Pfizer’s sales force helped selling the drug to
physicians throughout the United States.

A company’s management process is fundamentally affected by the firm’s overall business

strategy and its strategy for accessing its target markets. The relationship between business
strategies, a firm’s marketing strategy, and a firm’s strategic sales force program is discussed in
this unit.

Sales force organization is primarily a function of properly sizing the sales organization to assure
that customers and prospects receive appropriate coverage, company products get proper
representation, and the sales force is stretched but not overworked. The appropriate planning of
the sales force will also depend on the size of the opportunity a firm faces and its expected sales
level.

2) Roles & Structure of the Sales Force:

To be successful and produce profitable results, the sales force must implement a firm’s business
strategy and market access strategy. In other words, strategic plans are implemented through
the activities and behaviors of the sales force. Key sales force behaviors include calling on
certain types of customers and prospects, managing customer relationships and creating value
for individual customers. The role of the sales force in implementing a firm’s market access
strategy is very important.

To meet customer needs efficiently and effectively and to sell the firm’s products and services, a
sales force must be well organized. Sales force structure decisions influence how customers see
the firm because sales force structure will affect the selling skills and knowledge level required of
salespeople. In turn, sales management activities such as compensation, recruitment, training,
and evaluation are affected.

3) Building Sales Competencies:

Sales managers are responsible for hiring salespeople with the appropriate skills and
backgrounds to implement the sales strategy. Good sources must be found for new hires, and
those who are weak in these areas must be carefully screened out. In addition to hiring qualified
people, salespeople’s competencies are usually developed through training before they are sent
into the field. Sales managers are responsible for making sure that training is completed, and
they often conduct some of the classes. Most initial training programs are designed to familiarize
salespeople with the company’s products, services, and operating procedures, with some time
devoted to development of selling skills. Because sales training is expensive, the sales manager
is responsible for selecting the most cost-effective methods, location, and materials.

4) Leading the Sales Force:

Effective sales managers know how to supervise and lead their salespeople. Sales managers
provide leadership by inspiring people to grow and develop professionally, while achieving the
revenue goals of the firm. Good leaders provide models of behavior for employees to emulate,
often developing strong mutual trust and rapport with subordinates. Leadership styles vary, but
effective leaders are adept at initiating structure – that is, organizing and motivating employees,
setting goals, enforcing rules, and defining expectations. In addition to leading the sales force in
business results, sales managers are also expected to lead by example in encouraging ethical
behavior within the sales force. Salespeople are continually confronted with ethical dilemmas
Sales managers use a variety of tools in their efforts to motivate salespeople to work more
efficiently and effectively.

5) Goal directed effort:

There are many techniques that have proved to be effective motivators, including sales
meetings, quotas, sales contests, and recognition awards. The most powerful motivator for
salespeople is often a well-designed compensation package. Money is an important consideration
for attracting and motivating people to work hard. A key task for sales managers is to devise an
effective mix of salary, bonuses, commissions, expenses, and benefits without putting the firm’s
profitability in jeopardy.
6) Evaluate the performance of the sales force:
The final step in the sales management process is to evaluate the performance of the sales force
and develop the skills of their people. This involves analyzing sales data by account, territory,
and product line breakdowns. It also means reviewing selling costs and measuring the impact of
sales force activities on profits.

b. Define sales quotas with 2 examples.

Ans.: Sales Quotas

Sales quotas are a way of life for the sales force. All activities of the sales force revolve around
the fulfillment of sales quotas. Sales quotas are targets assigned to sales personnel. They signify
the performance expected from them by the organization. Sales quotas help in directing,
evaluating and controlling the sales force. They form an indispensable tool for sales managers to
carry out sales management activities. Sales quotas are prepared on the basis of sales forecasts
and budgets. Sales quotas serve various purposes in organizations.

They provide targets for sales personnel to achieve & also act as standards to measure sales
force performance and help motivate the sales force. Compensation plans are invariably linked to
quotas. The commission and bonuses given to sales persons are based on their meeting quotas
set for them. The four categories of sales quotas widely used are:
– Sales volume quotas,
– Expense quotas,
– Activity quotas and
– Profit quotas.
Sales quota should be fair, challenging yet attainable, rewarding, easy to understand, flexible
and must satisfy management objectives.
It must also help in the coordination of sales force activities. Setting motivating and easy to
understand quotas is essential to obtain the cooperation of the sales force. Various methods are
used to set sales quotas, among which, quotas based on sales forecasts and market potential are
the most common. Skilful administration by sales managers is required for effective
implementation of quotas. Convincing salespeople about the fairness and accuracy of quotas
helps the sales management to successfully implement quotas.

Sales quotas have certain limitations such as being time consuming, difficulty in comprehending
if complicated statistical calculations have been used and focusing on attaining sales volumes at
the cost of ignoring important non-selling activities. Quotas may reduce risk-taking among sales
personnel and may influence them to adopt unethical selling practices. With changes in the
competitive environment and variations in customer expectations, many companies have started
developing compensation plans that are increasingly based on non-traditional aspects, thereby
reducing dependency on quotas.
The process of establishing normal and reasonable sales quotas can vary greatly as a function of
the business, industry, type and size of the sales organization, and product and/or service being
sold. However, there can often be a great deal of commonality in the approach to this important
sales-generating tool.
Q.2 Just a few months back, Laker Pvt. Ltd. has expanded its product mix. The
management has decided to set up new objectives for its distribution system. The
management also wants to change the channel design and network according to the
new objectives. Please advice the management of Laker Pvt. Ltd. how to go about it.

Ans.: Designing Marketing Channels

1) Factors considered for designing Distribution Channels:
Like most marketing decisions, a great deal of research and thought must go into determining
how to carry out distribution activities in a way that meets a marketer’s objectives. The marketer
must consider many factors when establishing a distribution system. Some factors are directly
related to marketing decisions while others are affected by relationships that exist with members
of the channel.
The following are the key factors to consider when designing a distribution strategy. We can
group these into two main categories:
– Marketing decision issues and
– Channel relationship issues.
Marketing Decision Issues: Distribution strategy can be shaped by how decisions are made in
other marketing areas as under:

1) Product Issues
The nature of the product often dictates the distribution options available especially if the
product requires special handling. For instance, companies selling delicate or fragile products,
such as flowers, glass articles, etc., look for shipping arrangements that are different than those
sought for companies selling extremely tough or durable products, such as steel rods.

2) Promotion Issues
4Besides issues related to physical handling of products, distribution decisions are affected by
the type of promotional activities needed to sell the product to customers. For products needing
extensive salesperson-to-customer contact (e.g., automobile purchases) the distribution options
are different than for products where customers typically require no sales assistance (i.e., bread
purchases).

3) Pricing Issues
The desired price at which a marketer seeks to sell their product can impact how they choose to
distribute. The inclusion of resellers in a marketer’s distribution strategy may affect a product’s
pricing since each member of the channel seeks to make a profit for their contribution to the sale
of the product. If too many channel members are involved the eventual selling price may be too
high to meet sales targets in which case the marketer may explore other distribution options.

4) Target Market Issues

A distribution system is only effective if target customers can obtain the product. Consequently,
a key decision in setting up a channel arrangement is for the marketer to choose the approach
that reaches target customers in the most effective way possible. The most important decision
with regard to reaching the target market is to determine the level of distribution coverage
needed to effectively meet customer’s needs. Distribution coverage is measured in terms of the
intensity by which the product is made available. For the most part, distribution coverage
decisions are of most concern to consumer products companies, though there are many
industrial products that also must decide how much coverage to give their products.
The marketer must take into consideration many factors when choosing the right level of
distribution coverage. However, all marketers should understand that distribution creates costs
to the organization. Some of these expenses can be passed along to customers (e.g., shipping
costs) but others cannot (e.g., need for additional salespeople to handle more distributors). Thus,
the process for determining the right level of distribution coverage often comes down to an
analysis of the benefits (e.g., more sales) versus the cost associated with gaining the benefits.
Levels of distribution coverage: There are three main levels of distribution coverage – mass
coverage, selective and exclusive.

1) Mass Coverage – The mass coverage (also known as intensive distribution) strategy
attempts to distribute products widely in nearly all locations in which that type of product is sold.
This level of distribution is only feasible for relatively low priced products that appeal to very
large target markets (e.g., FMCG products). A product such as Coca-Cola is a classic example
since it is available in a wide variety of locations including grocery/provision stores, convenience
stores, vending machines, hotels and many, many more. With such a large number of locations
selling the product the cost of distribution is extremely high and must be offset with very high
sales volume.

2) Selective Coverage - Under selective coverage the marketer deliberately seeks to limit the
locations in which this type of product is sold. The logic of this strategy is due to the size and
nature of the product’s target market. Products with selective coverage appeal to smaller more
focused target markets (e.g., air conditioners) compared to the size of target markets for mass
marketed products. Consequently, because the market size is smaller, the number of locations
needed to support the distribution of the product is fewer.

3) Exclusive Coverage - Some high-end products target very narrow markets that have a
relatively small number of customers. These customers are often characterized as
―discriminating in their taste for products and seek to satisfy some of their ‖ needs with
highquality, though expensive products. Additionally, many buyers of high-end products require
a high level of customer service from the channel member from whom they purchase. These
characteristics of the target market may lead the marketer to sell their products through a very
select or exclusive group of resellers. Another type of exclusive distribution may not involve
highend products but rather products only available in selected locations such as company-
owned stores. While these products may or may not be higher priced compared to competitive
products, the fact those these are only available in company outlets give exclusivity to the
distribution.

While these three distribution coverage options serve as a useful guide for understanding how
distribution intensity works, the advent of the Internet has brought into question the
effectiveness of these schemes. For all intents and purposes all products available for purchase
over the Internet are distributed in the same way - mass coverage. So a better way to look at the
three levels is to consider these as options for distribution coverage of products that are
physically purchased by a customer (i.e., walk-in to purchase).

Q.3. A. What is difference between direct and indirect distribution channels? Also
mention the parties involved in direct and indirect channels.

Ans.: Difference between Direct distribution & indirect distribution

Direct Distribution System:
With a direct distribution system the marketer reaches the intended final user of their product by
distributing the product directly to the customer. That is, there are no other parties involved in
the distribution process that takes ownership of the product. The direct system can be further
divided by the method of communication that takes place when a sale occurs. These methods
are:
1) Direct Marketing Systems – With this system the customer places the order either through
information gained from non-personal contact with the marketer, such as by visiting the
marketer’s website or ordering from the marketer’s catalog, or through personal communication
with a customer representative who is not a salesperson, such as through toll-free telephone
ordering.
2) Direct Retail Systems – This type of system exists when a product marketer also operates
their own retail outlets. Bata Shoes is an example of this strategy.
3) Personal Selling Systems – The key to this direct distribution system is that a person whose
main responsibility involves creating and managing sales (e.g., salesperson) is involved in the
distribution process, generally by persuading the buyer to place an order. While the order itself
may not be handled by the salesperson (e.g., buyer physically places the order online or by
phone) the salesperson plays a role in generating the sales.
4) Assisted Marketing Systems – Under the assisted marketing system, the marketer relies
on others to help communicate the marketer’s products but handles distribution directly to the
customer. The classic example of assisted marketing systems is eBay, which helps bring buyers
and sellers together for a fee. Other agents and brokers would also fall into this category.

Indirect Distribution System:

With an indirect distribution system the marketer reaches the intended final user with the help of
others. These resellers generally take ownership of the product, though in some cases they may
sell products on a consignment basis (i.e., only pay the supplying company if the product is sold).
Under this system intermediaries may be expected to assume many responsibilities to help sell
the product.

Indirect methods include:

1) Single-Party Selling System - Under this system the marketer engages another party who
then sells and distributes directly to the final customer. This is most likely to occur when the
product is sold through large store-based retail chains or through online retailers, in which case it
is often referred to as a trade selling system.
2) Multiple-Party Selling System – This indirect distribution system has the product passing
through two or more distributors before reaching the final customer. The most likely scenario is
when a wholesaler purchases from the manufacturer and sells the product to retailers.
3) Multi-channel or Hybrid System – In cases where a marketer utilizes more than one
distribution design the marketer is following a multi-channel or hybrid distribution system. Many
electronic appliance companies like Videocon or LG follow this approach as their distribution
design includes using a direct retail system by selling in company-owned stores, a direct
marketing system by selling via direct mail/internet, and a single-party selling system by selling
through general appliance stores (they also use other distribution systems).

The multi-channel approach expands distribution and allows the marketer to reach a wider
market. However, the marketer must be careful with this approach due to the potential for
channel conflict.

b. Distinguish between sales forecasting and sales budget with examples.

Ans.: Sales Forecasting & Sales Budgeting:

Creating a budget doesn't have to be a complicated or time-consuming task. Actually, in the
beginning, it's best to keep things simple. The key is to determine how much the company will
spend and earn in any given year, and then use that figure to project how it wants to grow in
subsequent years.
If it is a running business, it's simply a matter of digging through some records to see where the
money went, and deciding where the management actually wants it to go. If it is a new company,
the management needs to do some homework and make realistic assumptions about the
business. Either way, a budget is simply a tool that allows them to put the money where it can
best be used.
To get started, the management should have following data:
– Expected sales of products/services
– Expected Prices of goods or services
– Estimated cost to produce these products
– Estimated operating expenses
– Estimated taxes
– Expected borrowings & cost of such borrowings
The above data will form the basis of the overall budget and forecast.
In the income category, one should conservatively estimate how much sales revenue is expected
next year. For this it is necessary to look at what sales were made last year, and extrapolate and
forecast from that. New business owners without this kind of history should try to determine how
much money their competitors gross, and use that as a guide.
As far as expenses go, all sales related expenses including advertising, automobile expenses,
insurance, rent, taxes, phone, mobiles, utilities, equipment, payroll, commissions, incentives, etc.
– in other words, any and all sales related expenses, should be listed out whether they are being
incurred now or whether the company may incur them in the future.
Once the projected income and expenses are listed down on paper, it will be known as to exactly
how much revenue & profit is needed every month to keep things afloat, and how much will be
left over for extra expenses. It will be far less tempting to spend money on business expenses
that aren't part of the plan. And that's really what a budget is for – to ensure that the expenses
aren't more than the income.

Q.4. you are a sales manager in ABC firm. You have taken some interviews and
shortlisted a few candidates. How will you select the right candidate for the sales job?
Once you have made the selection, what would be your next step in order to make the
new recruits effective in their sales jobs?

Ans.: Selecting of Right Sales Personnel

Selection of the right sales people involves the following steps:
1) Researching Candidates:
This covers the early stages of the selection process - often called pre-selection. The recruitment
campaign would have attracted a pool of applicants from which selectors can make their choice.
If a job analysis has been conducted, the criteria or competences, which are deemed necessary,
have been identified. These may be well defined and focused on experience and skills, as in the
'right person' approach; or general and related to education, intellect and personality for the
'cultural fit' and 'flexible person' models.

2) Application letters/CVs/resumes:
These are typically used for initial or speculative applications. The first stage in the application
will require a resume or a CV.

3) Application forms (blanks):

Both letters and CV/resumes present a problem for a large recruitment programme: applicants
may not provide all the relevant information and what there is will be presented in different
ways. Comparison of applicants is easier if data is presented in a standard application form
(blank).

4) Interviewing:
The interview is a social ritual, which is expected by all participants, including applicants. It is
such a 'normal' feature of filling vacancies that candidates for a job would be extremely surprised
not to be interviewed at least once. Despite the existence of alternative methods of selection
most employers regard the formal selection interview as the most important source of evidence
in making the final decision. A selection interview can be neatly defined as a conversation with a
purpose.

5) Preparation for interviews:

Training for interviewers stresses the need to put the candidate at ease, have a comfortable
environment, etc. The interviewer should ensure that relevant information (e.g. application
forms) is read beforehand - it is surprising how many interviewers are found reading such
material for the first time during the interview. It is necessary to improve the interpersonal skills
of the interviewer and the interviewer's ability to make decisions without influence from non-job
related information. Interviewers should be trained to:
1) Avoid asking questions unrelated to the job
2) Avoid making quick decisions about an applicant
 3) Avoid stereotyping applicants
4) Avoid giving too much weight to a few characteristics.
5) Try to put the applicant at ease during the interview
6) Communicate clearly with the applicant
7) Maintain consistency in the questions asked

Sales Personnel Training Programmes: The primary function of professional sales is to

generate and close leads, educate prospects, fill needs and satisfy wants of consumers
appropriately, and therefore turn prospective customers into actual ones. The successful
questioning to understand a customer's goal and requirements relevant to the product, the
further creation of a valuable solution by communicating the necessary information that
encourages a buyer to achieve their goal at an economic cost is the responsibility of the
salesperson. A good sales person should never miss sell or over evaluate the customer’s
requirements.

The sales personnel training programmes will include the following areas:

1) Market information:
This information is about customer profile, market updates, and computer integrated
manufacturing applications, etc
2) Sales Process:
This covers how to deal in the situation of conflicts with customer, coaching on undesirable
behavior, supplement skills developed during live courses, etc.
3) Product information:
This includes information such as, product usage, applications, system description, product
description, comparison with competitor’s products, etc
4) Policies and procedures:
This area covers information about sales contests; incentive plans on achieving targets, annual
bonuses, winners receiving the best salesperson award to motivate the sales force, etc.

Q. 5 a. What is logistics? What is its importance?

Ans.: Origin and Definitions of Logistics:

The term "logistics" originates from the ancient Greek "logos" means ratio, word, calculation,
reason, speech, and oration". Logistics is considered to have originated in the military's need to
supply themselves with arms, ammunition and rations as they moved from their base to a
forward position. In ancient Greek, Roman and Byzantine empires, there were military officers
with the title „Logistics- who were responsible for financial and supply distribution matters.
"Logistics means having the right thing, at the right place, at the right time." Logistics, the
synonymous term of physical distribution, involves planning, implementing, and controlling the
physical flow of materials from the point of origin to the point of the consumer at a profit. The
role of logistics is to get the right amount of product to the right places in the right time. Logistics
is defined as a business-planning framework for the management of material, service,
information and capital flows. It includes the increasingly complex information, communication
and control systems required in today's business environment.
Logistics the process of planning, implementing, and controlling the efficient, effective flow and
storage of goods, services, and related information from point of origin to point of consumption
for the purpose of conforming to customer requirements
Logistics is the science of planning and implementing the acquisition and use of the resources
necessary to sustain the operation of a system.
The two logistics activities vital to order filling are the communication of customer order
information to the order filling area and the actual process of picking out of the inventory the
items ordered. In the order information stage, communication can reduce errors in transferring
order information from the order to the warehouse receipt. Communication with customers is
vital to monitoring service levels relating to dependability.
Customer communication is essential to design of logistics service levels. The communication
channel must be constantly open and readily accessible to all customers. Without customer
contact, the logistics manager is unable to provide the most efficient and effective service.
Communication must be a two-way process. The seller must be able to transmit vital logistics
service information to the customer. In addition many customers request information on the
logistics status of shipments. The customer who needs information to plan operations expects
the logistics manager to provide answers on a timely basis.
Importance of Logistics: The logistics function includes sourcing and procurement, production
planning and scheduling, packaging and assembly, and customer service. It is involved in all
levels of planning and execution – strategic, operational and tactical. Logistics management is an
integrating function, which coordinates and optimizes all logistics activities, as well as integrates
logistics activities with other functions including marketing, sales manufacturing, finance and
information technology.
Logistics is much more and much wider than mere physical handling of goods. Logistics involves
several other functions such as purchasing, plant location, plant layout, etc., and even the
disposal of wastes. It covers astonishingly varied professional disciplines. They are:
1) Facility location
2) Planning
3) Forecasting and order management
4) Transportation: the mode and the route
5) Inventory management: all inventories
6) Warehousing
7) Protective packaging
Raw material and finished products had always to be moved, though on a small scale. Things
began changing with the advance in transportation. Population began moving from rural to urban
areas and to business centers. No longer did people live near production centers, nor did
production take place near residence centers. The geographical distance between the production
point and consumption point increased.
Since the early 1990's, the business scene has changed. The globalization, the free market and
the competition has required that the customer gets the right material, at the right time, at the
right point and in the right condition at the lowest cost. This is "globalization" and is not unusual
today. Here are some of the logistics functions that allowed this to happen:
1. Purchasing – of raw materials, assembled products, finished products from all over the world.
Where can you get the quality you want at the best price?
2. Manufacturing operations – how should the machines be organized, how many workers do you
need, where do you stock your materials and finished products, how many products do you
manufacture on each production run, etc.
3. Transportation – domestic and international, from raw materials to finished product; that
moves what, and when, and for what price?
4. Warehousing – product is either moving (transportation) or not (warehousing). This is
becoming a very sophisticated area and a key to shortening the time to market for products.
5. Inventory control – how much product is on hand, on order, in transit, and where is it?
Inventory drives logistics.
6. Import/export – international regulations and documentation can be complex. It takes a
specialist to understand the best way to get product across borders.
7. Information systems – globalization on today's scale is possible because there is technology
that transfers the needed information. Logistics functions are unavoidable costs to a company,
but today they are recognized as crucial to a company's competitiveness and profitability.

b. Name the various costs involved in distribution with examples.

Ans.: Costs involved in distribution: In discussing selling and distribution expenses with
winery owners, they often start their list with the increased cost of labor, over-generous
discounts, or high commissions. These discussions usually center upon tasting room sales or
winery direct sales to local restaurants or wine shops. However, even if a winery does not
maintain its own sales force or uses outside brokers and salespeople, there can be hidden sales
and distribution expenses involved on the wholesale level. Consider some of the following:
1) Compliance and licensing fees.
2) The cost of samples (including shipping).
3) Wine list charge backs.
4) Market visits.
5) Internal employee errors.
6) Promotional expenses.
These additional costs can impact profit levels if not anticipated when projecting net profits.

Once accurate production costs per case are established for each wine, pricing and profit levels
can be projected. However, sales and distribution costs must be determined in order to identify
expenses attributed to the cost of sales. Regardless of whether wineries maintain their own
salespeople, use outside sales teams, or develop a wholesaler network, there are expenses
incurred when attempting to sell their wines to restaurants and retailers. These selling costs
usually involve activities surrounding the storage, distribution, and selling of bottled case goods.

If case storage is not at the winery, storage and distribution expenses begin with wine stored in
an off-site warehouse location--or several locations--convenient for local and interstate trucks to
pick up, consolidate, and deliver wines to customers. Monthly case storage (by varietal and
vintage), can add up--especially if sales are not moving at as fast as projected. Storage costs
continue until a vintage is completely sold out, and is one of the most commonly overlooked
distribution expenses.

Q. 6. Examine the recent trends in sales management.

Ans .: Recent Trends in Sales Management:

1) Wholesaling
Wholesaling refers to the activities involved in selling to organizational buyers who intend to
either resell or use for their own purposes. A wholesaler is an organization providing the
necessary means to: 1) allow suppliers (e.g., manufacturers) to reach organizational buyers (e.g.,
retailers, business buyers), and 2) allow certain business buyers to purchase products which they
may not be able to purchase otherwise.
According to the 2002 Census of Wholesale trade, there are over 430,000 wholesale operations
in the United States.
While many large retailers and even manufacturers have centralized facilities and carry out the
same tasks as wholesalers, we do not classify these as wholesalers since these relationships only
involve one other party, the buyer. Thus, a distinguishing characteristic of wholesalers is that
they offer distribution activities both for a supplying party and for a purchasing party. For our
discussion of wholesalers we will primarily focus on wholesalers who sell to other resellers such
as retailers.
2) Retailing
The term ‘retailing’ refers to ‘the activities involved in selling commodities directly to
consumers’.

Definition
Retailing consists of the sale of goods or merchandise for personal or household consumption
either from a fixed location such as a department store or kiosk, or from a fixed location and
related subordinated services.

Defined here as sales of goods between two distant parties where the deliverer has no direct
interest in the transaction, the earliest instances of distance retailing probably coincided with the
first regular delivery or postal services. Such services would have started in earnest once man
had learned how to ride a camel, horse, etc.
Why?
When individuals or groups left their community and settled elsewhere, some missed foodstuffs
and other goods that were only available in their birthplace. They arranged for some of these
goods to be sent to them. Others in their newly adopted community enjoyed these goods and
demand grew. Similarly, new settlers discovered goods in their new surroundings that they
dispatched back to their birthplace, and once again, demand grew. This soon turned into a
regular trade. Although such trading routes expanded mainly through the growth of traveling
salesmen and then wholesalers, there were still instances where individuals purchased goods at
long distance for their own use. A second reason that distances selling increased was through
war as armies marched through territories, they laid down communication lines stretching from
their home base to the front. As well as garnering goods from whichever locality they found
themselves in, they would have also taken advantage of the lines of communication to order
goods from home.
In commerce, a retailer buys goods or products in large quantities from manufacturers or
importers, either directly or through wholesalers, and then sells individual items or small
quantities to the general public or end-user customers, usually in a shop, also called a store.
Retailers are at the end of the supply chain. Marketers see retailing as part of their overall
distribution strategy.
Shops may be on residential streets, or in shopping streets with few or no houses, or in shopping
centers. Shopping streets may or may not be for pedestrians only. Sometimes a shopping street
has a partial or full rooftop to protect customers from precipitation. Online retailing, also known
as e-commerce, is the latest form of non-shop retailing.
Shopping generally refers to the act of buying products. Sometimes, this is done to obtain
necessities such as food and clothing; sometimes, it is done as a recreational activity.
Recreational shopping often involves window shopping (just looking, not buying) and browsing
and does not always result in a purchase.