DL - Buying, Shipping, and Receiving [LESSON]

Buying, Shipping, and Receiving

If a channel member has run out of a product when a customer wants to buy it, the result is often a lost sale. That's why most channel members stock, or "carry," reserve inventory. However, storing products is not free. Warehouses cost money to build or rent and heat and cool; employees have to be paid to stock shelves, pick products, ship them, and so forth. Some companies, including Walmart, put their suppliers in charge of their inventory. The suppliers have access to Walmart's inventory levels and ship products when and where the retailer's stores need them.
Physical goods that travel within a channel need to be moved from one member to another and sometimes back again. Some large wholesalers, distributors, and retailers own their own fleets of trucks for this purpose. In other cases, they hire third-party transportation providers—trucking companies, railroads, and so forth—to move their products.
Being able to track merchandise like you can track a FedEx package is extremely important to channel partners. They want to know where their products are at all times and what shape they are in. Losing inventory or having it damaged or spoiled can wreak havoc on a company's profits. So can not getting products on time or not being able to get them at all when your competitors can.

Buying, Shipping, and Receiving

Buying Terms

Buying Terms Retail Buyers – purchase goods for resale Consignment buying – goods are paid for only after the final customer purchases them Memorandum - occurs when the supplier agrees to take back an unsold goods by a certain pre-established date Reverse auction – companies post what they want to buy, and suppliers bid for the contract Organizational buyers – buyers who purchase goods for business purposes in large quantities. Buyers must have knowledge about the product they buy and understand the operation to their firm. Open-to-buy – The amount of money a retailer has left for buying goods after considering all purchases received, on order, and in transit.

Shipping Terms

 

Shipping Terms Common Carriers – provides transportation services to any business in their operating area Contract Carrier – for-hire carriers that provide equipment and drivers for specific routs Private carrier – transport goods for an individual business Ton-Mile – the movement of one ton of freight one mile Freight forwarder: private companies that combine less-than-carload or less-than-truckload shipments from several different businesses and deliver them to their destination.

 

Receiving Process

Receive the goods – be aware of the ship date and prepared for the arrival, make sure the arrival date is staffed, prepare back room or receiving area for shipment. Check the goods – verify the quantity and condition of the shipment, electronic data is used to verify the contents and information. Mark the goods (if necessary) – pricing or tagging the merchandise Universal Product Codes (UPC’s) are widely used, sources marking – used by sellers/manufactures to mark the manufactures to mark the merchandise with the price before delivering, electronic product codes (EPC’s) or radio frequency identification (RFID) tags – send data using radio waves. Move the goods – move the goods to the sales floor, old merchandise is moved off the floor.

 

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