According to Philip Kotler, most producers do not sell their goods directly to final users. Between producers and final users stands one or more marketing channels, a host of marketing intermediaries performingt a variety of functions. Marketing-channel decisions are among the most critical decisions facing management. The company’s chosen channel(s) profoundly affect all other marketing decisions. Companies use intermediaries when they lack the financial resources to carry out direct marketing, when direct marketing is not feasible, and when they can earn more by doing so. The most important functions performed by intermediaries are information, promotion, negotiation, ordering, financing, risk taking, physical possession, payment, and title. Manufacturers have many alternatives for reaching a market. They can sell direct or use one, two, or three-level bhannels. Deciding which type(s) of channel to use calls for analyzing customer needs, establishing channel objectives, and identifying and evaluating the major alternatives, including the types and numbers of intermediaries involved in the channel. Effective channel management calls for selecting intermediaries and training and motivating them. The goal is to build a long-term partnership that will be profitable for all channel members. Marketing channels are characterized by continuous and sometimes dramatic change. Three of the most important trends are the growth of vertical marketing systems, horizontal marketing systems, and multichannel marketing systems. All marketing channels have the potential for conflict and competition resulting from such sources as goal incompatibility, poorly defined roles and righats, perceptual differences, and interdependent relationship. Companies can manage conflict by striving for superordinate goals, exchanging people among two or more channel levels, coopting the support of leaders in different parts of the channel, and encouraging joint membership in and between trade associations. Channel arrangements are up or the company, but there are certain legal and ethical issues to be considered with regard to practices such as exclusive dealing or territories, tying agreements, and dealers’ rights. E-commerce has grown in importance as companies have adopted “brick-and-click” channel systems. Channel integration must recognize the distinctive strengths of online and offline selling and maximize their joint contributions.

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Retailing includes all the activities involved in selling goods or services directly to final consumers for personal, nonbusiness use. Retailers can be understood in terms of store retailling, nonstore retalling, and retail organizations. Like products, retail-store types pass through stages of growth and decline. As existing stores offer more services to remain competitive, costs and prices go up, which opens the door to new retail forms that offer a mix of merchandise and srevices at lower prices. The major types of retail stores are specialty stores; department stores; super-markets; convenience stores; discount stores; off-price retailers (factory outlets, independent off-price retailers, and warehouse clubs); superstores (combination stores and supermarkets); and catalog showrooms. Although most goods and services are sold through stores, nonstores retailing has been growing. The major types of nonstore retailing are direct selling (one-to-one selling, one-to-many –party selling, and multilevel network marketing); direct marketing (which includes e-commerce and Internet retailing);automatic vending; and buying services. Although many retail stores are independently owned, an increasing number are failing under some form of corporate retailing. Retail organizations achieve many economies of scale, such as greater purchasing power, wider brand recognition, and better-trained employees. The major types of corporate retailing are corporate chain stores, voluntary chains, retailer cooperatives, consumer cooperatives, franchise organizations, and merchandising conglomerates. Like all marketers, retailers must prepare marketing plans that include decisions on target markets, product assortment and procurement, services and store atmosphere, price, promotion, and place. These decisions must take into account major trends, such as the growth of private labels, new retail forms and combinations, growth of inter-type retail competiton, competition between store-based and non-store-based retailing, growth of giant retailers, decline of middle-market retailers, growth investment in technology, and global presence of major retailers. Wholesaling includes all the activities involved in selling goods or services to those who buy for resale or business use. Wholesalers can perform functions better and more cost-effectively than the manufacture can. These functions include selling and promoting, buying and assortment building, bulk breaking, warehousing, transportation, financing, risk bearing, dissemination of market information, and provision of management services and consulting. There are four types of wholesalers;merchant wholesalers; brokers and agents; manufacturers’ and retailers’ sales branches, sales officers, and purchasing offices; and miscellaneous wholesalers such as agricultural assemblers and auction companies. Like retailers, wholesalers must decide on target markets, product assortment and services, price, promotion, and place. The most successful wholesalers are those who adapt their services to meet suppliers’ and target customers’ needs. Producers of physical products and services must decide on market logiostics-the best way to store and move goods and services to market destinations; to coordinate the activities of suppliers, purchasing agents, manufacturers, marketers, channel members, and customers. Major gains in logistical efficiency have come from advances in information technology.