Consequently, IKEA would select those suppliers who have mutual purpose. For example, loyalty of eastern European suppliers happen issues (Clayton 2007). Besides, this firm had encountered several traps when establishing collaborative nexus. This may threaten to the future development of IKEA. However, it is noteworthy that suppliers have low power of bargaining, they may require more profits. Then, the research of IKEA’s supplier strategy showed it has built long-term and friendly cooperative relations with other suppliers, such as Konakovo factory, Priozersk factory, Lenrauma and PROFIm through exchange values and personal bonding (2007). Roughly, IKEA has more than 1,000 suppliers in 52 countries and nearly 32 distribution centres in 16 countries. According to IKEA official website, it employs catalog, website, publication, brochure, advertising and physical stores employ various channels to provide consumers a full range of products introduction. Of course, the success of the IKEA is based on its products’ good quality that can please consumers’ needs, and also it cannot without effective distributions and logistics channels. Furthermore, since most of sold products belong to CPGs, this company has decreased the number of transport channels as much as possible in order not to increase the cost. Its target consumers are those young couples and middle class families who are keen on fashionable household products without higher price. Besides, this company always pursues to positioning brand into cost leadership and differentiation. Its businesses have expanded to global market including Europe, USA, Australia, China and Japan. IKEA as a famous retailer has unique brand equity, and it specializes in selling well-designed and low cost home furniture. Overall, no matter directly or indirectly sells goods to customers, the final purpose is to effectively please consumers and gain profits from targeted customers (Sean n.d.). In addition, push and pull strategies would help manufacturers effectively enhance sales and further satisfy customers. When considering suitable channels of distributions and logistics, wise marketers should be based on the characteristics of products, level of price, and promotion approaches to decide use of intensive or selective distributions. Better solutions are manufacturers can establish strong relation between other parties or share total revenues to them. Several conflicts always exist in this cooperative relationship, for example, more powerful retailers, controversies about prices and profits, or lack of trust between collaborators. On the other hand, the manufacturer would prefer to rely on other wholesalers or retailers to sell products due to shortage of logistics or distribution channels. Maybe, manufacturers need undertake many pressures if sales are below the expected. Normally, if producers have enough money and resources, they would integrate distribution channels to directly sell goods to consumers. In this process, the manufacturer can choose to cooperate with wholesaler or retailer based on own situation (as the figure). In the field of marketing, distribution channel is the procedure that the product passes from the manufacturer to the consumers (Neil n.d.). Those merchants are very happy to see such consequences because they successfully convey their products and ideas to their customers through these distribution channels. The main reason is your cognition guides your behaviour, which means you know those locations have what you need goods. Relatively, if you need buy a pair of suitable shoes for next week’s party, you may go to physical store or online store. If you do not have enough cereals, breads and milk, you may drive to the nearest Coles or Woolworths to buy.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |