Managing the Trade Marketing Relationships of Texfin - Case Study Example

Name : xxxxxxxxxxx Institution : xxxxxxxxxxx Title : Managing the trade marketing Relationships of Texfin Tutor : xxxxxxxxxxx Course : xxxxxxxxxxx @2010 Table of Contents Title : Managing the trade marketing Relationships of Texfin 1 Table of Contents 2 Managing the trade marketing relationships of Texfin 3 Introduction 3 Findings of the market research on issues affecting B2B trade marketing in Texfin’s sector 3 Actions I would you recommend to Texfin’s senior management 6 The implications of this study on how we understand manufacturer/retailer IORs in general 12 Conclusion 14 Bibliography 14 Managing the trade marketing relationships of Texfin Introduction Business to business marketing forms an integral part when it comes to the whole concept of marketing. It is here where any form of marketing commences and it charts the may generally how the other promotional activities at the retail levels will be carried out. According to Buttle (1996), the manufactures cannot just produce goods or product just for the sake of it without primarily establishing the marketability of the product. They have to liaise with the retailers on the ground in order to establish the viability of the idea. In many instances however, as we are going to establish in the Texfin case this manufacturer-retailer relationship sometimes is not well established. We shall analyze the findings of the research that was commissioned by Texfin management in order to determine if promotion and branding had a role to play in the effectiveness of their channel management strategies. Moreover there will be implications which will be drawn from the Texfin case. Owing to the findings then we will be able to give the recommendation necessary to Texfin. Findings of the market research on issues affecting B2B trade marketing in Texfin’s sector The findings of the research had many things to tell on the issues affecting business to business marketing in Texfin’s sector. In terms of relative importance of the issues affecting B2B trade marketing in Texfin it was realized that despite the scores being quite uniform across the sample, there existed disparities among different customer segment. Merchant apparently identified with historical need to come in contact with their respective sales representative virtually every week. As pointed out by one of the merchants, they relied heavily on the manufacturer sales support to make their staff be up-to-date with what was going on in a given sector. As it was well noted relationship marketing was found to be very indispensable to the retailers. According to Ellis, (2011) Supply chain management has to address issues concerning distribution strategy, inventory management, information, distribution network configuration and trade offs in logistic activities. It was realized that retain groups had so much information about performance of the product and its movement in the market than the manufacturers themselves. Rank Issue Classification that was commissioned to be investigated gave insightful pointers of the real situation about the product and how it is performing in the market. Order completeness logistics service gave an indicator of the satisfaction that the potential customers were drawing from the products of Texfin in the way the specific orders were being acted upon. How well was the product reaching the customer helping them to solve the intended purpose? It follows that the retailers are the ones in the constant contact with the consumer on the ground and consequently they will have more knowledge about the product movement more than any one else. The market research commissioned also pointed out the importance of the sales representative in each region. The sales representatives are the ones to keep the manufacturers posted about the actual situation on the ground on the movement of the product in the market. This will also discern the changes to be made so that to keep up with the changing customer needs. On time delivery logistics service gave the feedback on how timely the good reaches to the customer. Does the customer get the good when he really wants it? If there some inconveniences then they should be addressed as soon as possible (Ellis, 2011). From the look of things the manufacturers had scant knowledge of the performance of the product on the ground. Apparently the retailers had been left to deal with the logistic of the final movement of the product to the consumer. As far as this was concerned, the manufacturers have little knowledge of what goes on the ground. Relationship marketing was surrendered to the retailers and consequently they are the ones who had to do the follow up and ensure a cordial relationship existed between the customer and the company. Market knowledge that should be realized through market intelligence was not invested in by Texfin and that the retailers seem to have much knowledge on the market and the product movement from the retailers. While the survey findings indicated that superior levels service of logistics offered Texfin the chance to have a competitive edge, if the rival manufacturers on the other hand improved their tactics then the effort by Texfin will be futile and instead it will level out with that of the competitors. Then Texfin was to look for alternative means to apt its performance owing to the imminent entry of other competitors. Consequently there was a lot to be done as far as relationship marketing practices were concerned if the retailers were to be used effectively as the market drivers. In this regard the essence of local sales representatives it was noted that their importance would decline and the central office will be used more instead. Crucial decisions were to be made about what to be done about the B2B budget that the firm intended to invest. The manufacturer-retailer relationship should be analyzed to establish if there is any synchronization that can be encouraged (Ellis, 2011). Actions I would you recommend to Texfin’s senior management Branding and promotion has a role to play in the effectiveness of the channel management strategies. The brand management strategies are needed to sustain the need at the consumer end. The brand should be made powerful so that the end users want to purchase the product. The wholesalers and retailers will not be prepared to stock a product that is not being bought by the end users. The product has to be promoted extensively to increase the market share of the product. The information collected by the retailers about the movement of the good in the market will be very vital to the manufacturers in trying to promote the brand supremacy of the product in the market. Trade marketing is founding out how the retailers and wholesalers think about the good and discover what should be done to motivate him (Hunt, 2010). In trade marketing it relates to building demand and the middlemen such as the wholesalers, retailers and distributors. The manufacturers may offer display allowances and promotional support to retailers in exchange for additional space. The middlemen should be encouraged to stock up the goods from a particular retailer. Trade marketing managers are in charge of developing marketing programs targeted to distributors, wholesalers and retailers. For example Texfin could advertise the product in the retailer’s magazine and moreover offer discounts to retailers that give their product additional floor space. Trade marketing managers should implement and coordinate marketing programs that increase the company brand presence and subsequent its market share. In the long run there will be improved customer satisfaction. There should effective coordination with the sales team to ensure that trade marketing strategies are aligned with sales objectives and the revenue targets. Supply chain management is the strategic and systematic coordination of the traditional business functions and tactics across these particular business functions within a company and across businesses within the supply chain. Considering that there are other competitors who are eying to enter the UK Market the Texfin sector has to up their promotional activities and their touch with the final consumers through the sales representatives and the retailers. The market research that was carried out had very low response rate and consequent in future research there should be incentives to encourage more participation by the correspondents. The pointers that were used to collect data could prove very effective if the response of those participating is encouraged through incentives. The retailers could get a discount if they agree to take part in the research. More importantly the final consumers could also be a target for this research. The logistics that the product go through before they reach the final consumer should be streamlined in order to make sure that the ordered good reach the final consumer in due time. As it has been accurately noted if the desired brand is not present on the intermediaries’ shelves the end user customer will simply purchase the nearest alternative and consequently management is an important issue for the manufacturers. Efficient logistic system is very important to keep the business going and ensure the swift deliver of the product to the intermediaries. An assessment should be done from time to time to ascertain the amount of the product being stocked by the middlemen. It is ironical that the retailers have more knowledge about the movement of the good that the manufacturers in the market. The manufacturers should be having vast knowledge about the movement of the goods in market. The sales representatives should up date the manufacturers from time to time about the state in the market as far the end user of the product is concerned. If the manufactures have no knowledge about the movement of the good I the market then it will be very difficult for them to set out a promotional budget. There should be more investment as far as supply chain management is concerned (Morris et al, 2001). From what was collected in the research about the sales representative product knowledge this could used to improve the strategies that will be used by the company to ensure that the sales team has adequate knowledge about the product and subsequently they can market it effectively. Product knowledge to the sales team should be an imperative requirement to ensure success. Maclaranet al 2009) argues that the sales team should link up with the intermediaries to ensure that enough knowledge has been collected about the movement of the good in the market. It will be crucial to carry await the research after some time to find out exactly what is happening at the end of the marketing chain. The frequency of the sales representative will give a clear indication of how aggressive the sales team is. The sales representation should always be in touch with the intermediaries and ensure any thing that they encounter is notified as soon as possible to the manufacturers and if there is a way of improvement then it is quickly put in place. It will be prudent to enhance the relationship marketing programs in order to get the desired positive results. Marketing brands to end users branding must be strengthened to make should that the Texfin brand maintains a competitive advantage over the others in the market. If the end users get to know the product well they will be encouraged to use the product. It is the role of the manufacturers to encourage the retailers and wholesalers to do promotion of the product to the end users. The sales promotional activities can be funded by the market (Lambert, 2008). It is important that there is full support from the manufacturers of the product. This will ensure that even if the other competitors dare to enter this market they will find a formidable brand already established in the market. It is rare to find a company that is a producer and at the same time a vendor to the end customers, it will be therefore necessary to delegate some of the duties to the middlemen in the market. The manufactures should help to create the links among the distributors, sales representatives, buyers and sales assistants. There should be merchandising support for new store opening, promotions and vigorous advertising campaign programs. Effort should be made in securing optimal product inventory, ensuring the presence of price tags checking conformity with confirmed planograms. Sales should be stimulated at every step the product takes towards the end users of the product. Manufacturing processes must be flexible to respond in due time to the changes in the market and should accommodate mass customization. As one of the pointer in the research offer of customized promotions RM will prove to be a reality that cannot be dispensed with. According to Shaw and Mazur (1997), the promotions are specifically designed a particular customers. There should be ease in the placing of orders by the wholesalers, retailers and the distributors. In so doing this will ensure the product is available when it is needed it he end users or consumers. The manufacturer should finance the training of supplier’s staff in the handling of the product. If the staff of the suppliers have adequate product knowledge this will help them when it comes to carrying out promotional activities about the same good (Cousins, 2006). Randall (1994) notes that information about the market performance of the product could be obtained from the wholesaler and the retailers since they are the ones in contact with the end user fro time to time. In order to tell the direction or trend of the changing customer needs, this information is very important. Business to business marketing can only be successfully if there is a well developed supply chain management. All the players involved in the movement of the good from the producer to the manufacturer should be incorporated in a special program to ensure that there are no hitches in supply chain. Harrison et al, (2005) advice that the manufacturers should have an upper hand as far as the product knowledge is concerned. So long as Texfin establishes itself as a formidable company in the market its product would not loose it market share despite the two companies contemplating entering the same market. The competitors must have discovered a niche or unmet needs in the market before thinking about choosing to enter into this market (Brennan, 2010). From the survey carried out the company is able to tell where it has been found wanting as far promotion of the product is concerned as well as its manufacturing. You can only fix a problem when you exactly where the problem is. Determining how well the customers are satisfied with the good will enable Texfin to know what to do when it comes to new product development. The rank issue in the survey labeled as innovative packaging will indicate how creative the company is when it comes to creativity in branding. There should be a place where the correspondents are allowed to give their suggestions as far as what should be done to improve the packaging of the company. The information gathered should be used to come out with strategies that will strengthen the brand formidability in the market and expand the market share of the product (Mentzer, 2010). How the end user feels about the product is very important and this will reinforce the perception of the product in the mind of the consumer. The rate of new product development should be monitored by the product knowledge and the customer feels about the product. Capon (2008) notes that new products can only come up if there is a disparity in what is presently being offered in the market and therefore a niche is discovered and should be filled up. The quality of the product is very important to ensure the product is a force to reckon the market. High quality of the product will ensure that the product gain supremacy in the market. In its branding the product should very distinguished from that of the competitors to an extent of not being confusing or simply being the next alternative of the product. Business to business marketing is not only a one party affair and all the stakeholders should be incorporated to ensure success in the production and sell of the product to the final consumer. There should an elaborate program of collecting date and using the same done to improve the delivery of the same product to the intermediaries. Relationship marketing importance cannot be overlooked. Once a good is sold to the wholesale and retailer is not a one way affair and a relationship is forged between them and the producer. Tangible and intangible benefit should be offered to the retailers to ensure they are doing effective marketing of the product. Texfin could ensure that the other entrant in the market find it very hard to penetrate the market (Harrison et al. 2005). The implications of this study on how we understand manufacturer/retailer IORs in general The study has many implications as far as trade marketing is concerned. From the findings of the research it can be easily noted that relationship marketing was not well developed and the manufactures and the retailers were operating like lone rangers. We cannot expect where the sales representative are being used to get the full information about the product movement information in the market. There should be consultation from time to time between the manufacturers and the consumers. In this instance it can be said there was no smooth flow of information between the manufacturer and the retailer (McDonald, 2007). The study indicates that most of the manufacturers do not hold in high esteem their relationship with the wholesalers and retailers. Generally the manufacturers will carry out their activities in marketing without carrying the opinion of the retailers. The retailers, wholesalers and retailers stage their own strategies without coordinating with each other. When the marketing promotions are staged independently then their effective goal may not be realized fully. In order to optimize performance, supply chain function should operate in an integrated manner. Some retailers will cancel orders at the last meet disorienting the manufacturers (Dessy, 2010). Materials to the manufacturers may not arrive on time delaying the production function and consequently the good may not reach the willing customer in time. The manufacturers has to design internal policies based on human resource management practices aimed at increasing retailers’ employees sales effectiveness and external oriented policies capable of fostering potential customers’ acceptance of the company product benefits. The implications of this study gives the pointers of how the manufacturers and retailers overlook small but crucial things that should be done to ensure effective marketing of the good in the market. Disparities that occur between retailers and manufacturers marketing efforts derail the effectiveness of the marketing strategies in the long run (Cousins, 2006). Conclusion In conclusion it will be appropriate to say that the relationship between manufacturers and retailers is yet to be ironed out. Business to business marketing is just important as the promotion of the good to the final consumers. In order to have any effectiveness in marketing of the goods or product the manufacturers are required to get much of the information from the final handlers of the products who happen to be retailers. It is also important to carry out research in order to determine how effective the marketing strategy is and get to know any hitches in the marketing promotional program. Bibliography Ellis, N 2011, Business-to-Business Marketing: Relationships, Networks and Strategies, Oxford University Press, Oxford. Harrison, T. 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