For Professor Ryan

Place analysis

The distribution channel also known as marketing channel is the way through with services and goods changes hands from the vendor till that point it reaches the consumer. It is the process of availing the products to the end users, that is, the consumers. The marketing channel is very important to the management of a company, and is crucial when the management want so plan a good and effective marketing strategy (Ross, 2001).

The company can use either or all the ways listed below in the distribution of its candles into the market. The channels are:

Producer – Consumer

The manufacturer sells the commodities directly to the consumers. No middlemen are needed for this transaction. The end buyer is in contact with the producer and makes purchases for the products directly from the producer.

Producer – Retailer – Consumer

In this channel, the retailers purchase the products from the manufacturer and sell them to the consumers. This channel is good for producers how produce shopping goods, such as, tables, furniture, toys and shoes (Shaira, 2014)..

Producer- Distributor/wholesaler – Consumer

The goods go through the hands of the distributor or wholesalers before reaching the consumers. The wholesalers purchase the goods in bulk from the manufacturer and sell them to the consumers at a fair price.

Producer – Broker/Agent – Distributor/Retailer - Consumer

This marketing channel has several middlemen. The goods pass through the agent and distributors before reaching the consumers. The presence of agents helps to speed up the process.

The company should always have the required inventory in hand to satisfy the demand of the customers. The company should manage it inventory using the push and pull approach. Pull approach is a way in which order of the customers move the products, while push is where the company replenishes the stock frequently to reduce the shortage.

Pricing system

Setting the price of the product is very important in determining the success of the product. The price at which the company is selling its products should be favorable to both the consumers and the company. The company will be varying the pricing system according to the market and the cost of production, but during the introduction of products we are going to use penetration pricing. Pricing strategies include:

· Penetration pricing

The company can charge a cheap price so as to enter the market and later on raise the price after getting a good number of customers (Sunil, 2014).

· Competition pricing

This company can set the price of the candles considering the price of other companies. The price can set above the other companies, same as others or lower than competitors.

· Product pricing

This involves giving the candles price based on the price range of different products (Ross, 2001).

· Cost-based pricing

This is assigning price considering the cost incurred when producing the products. The price of the candles can include material cost, labor cost, delivery cost, fixed cost and administrative cost.

· Premium pricing

The price can be set to be high to show that the product is of high quality. There are customers who will go for the candles since they believe that the drives are of high quality.

· Cost plus pricing

The price of the candles can be set to include a profit margin. The cost added is the profit to the company (Shaira, 2014).

References

Ross, C. (2001). Marketing Principles and Practice. Virginia.

Shaira, B. (2014). The Method of the Madness. Havard College.

Sunil, G. (2014). Managing Consumers as an Investment. The Strategic Value of the Consumers in the long Run , 70-77.