Distribution Strategy - Formulation and Implementation

We advise on distribution strategy, both to car makers and to other market players including the supply chain and after-market distribution - who could well be new entrants.  We can advise upon the processes which would be most efficiently used, and when an independent distribution body is required we can participate in the ideal specification, evaluation and recruitment of logistics providers, regional distributors and retailers.

The goal-posts however are moving at an unprecedented rate.  Among the drivers are;

• Communications media are changing the way we arrange personal and business movements - for instance buying a car or arranging a flight, opening a credit card account or share trading

• In Europe, 'pressure groups' and legislators are forcing change which may be seen to disturb the delicate balance between providing value to the consumer, and the need for profitability in providing these services at all

• The move to minimise car inventories and meet customer needs better are both tending to lead to a wish to 'build to order' - whether this is actually feasible or desirable or not, is a whole other debate,

• customers are now well educated and demanding - they now virtually dictate how we should all do business with them

With these drivers dominating change in distribution, we need to accept that multiple channels are already with us, and can present a case for multiple channel retailing to co-exist if the formulae fit each other.

Refer also to our publication 'From Own to Use' representing an extreme future distribution scenario.

The Block Exemption

The recent new regulation from the EC has left many car makers in a quandry as to their future direction in distribution.  Clarification is being sought.  Only one thing is really clear - the ant-carmaker pressure groups have been well organised and have used their experience in car pricing debacle to force fundamental change in the way cars are are distributed, sold and serviced.  

Conversely, the car makers have not been able to speak with one voice, have arrogantly militated against change without presenting anything positive, and in fighting a rearguard action have naturally 'lost'.

The result will be at least in the short term, increased costs for all car makers as they implement all the changes.  Those car makers who have their own 'owned' retail outlets may still be able to control their markets, but they will also face some excessive price-led competition.

Our position is that we believe in the face of excessive competition only the retailers who operate super-lean and able to consistently provide exemplary customer service will survive in the longer term if they are prepared to operate on small margins of profitability.  Otherwise, the market will be open to all entrants, who may give sloppy service, bad customer relations etc., and this will adversely impact upon the reputation of previously desirable brands.

Long range planning would indicate that 'The Block Exemption' will disappear and a totally 'free' market will exist.  We have not yet met a car maker who is prepared to admit to planning for this scenario.  Nevertheless we have applied ourselves to this eventuality and are able to advise.  For instance, if cars become maintenance-free, then is a retailing network required?  How far can in-car communication aided by telematics go in enabling car makers and their customers to have a meeting of minds and machines?

Information Request Form

Select the items that apply, and then let us know how to contact you.

Send support information
Send literature on your practice
Have an Associate contact me

Send e- mail to noddy@mikewattam.com with all questions or comments about this web site.
Copyright © 2001, 2006, 2009 Mike Wattam & Associates
GREEN CREDS: This website is written entirely on re-cycled electrons.  When disposing of them, please do so responsibly.

Last modified: September 01, 2010