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Scenarios for Managing Product Distribution

This section outlines example processes performed by marketing administrators and key account managers in using distribution hierarchies and the Account Channel personalization attribute to determine how their products are distributed among their accounts. Your company may follow a different process according to its business requirements.

Product Distribution and Distribution Lists

The administrator at a large beverage manufacturing company is responsible for making sure that the right products are available for each customer account. He does so by controlling product distribution lists at the corporate level. These lists determine the set of products available at the key distribution account level of each account's hierarchy, and the subsets of products available to the accounts down the hierarchy. In addition, the administrator determines where various products should be displayed within retail outlets.

The Ace Corporation account consists of two warehouse distribution centers, Ace Corporation East and Ace Corporation West. Each warehouse supplies a number of retail outlets throughout North America. Ace Corporation headquarters determines which beverage items are stocked at each warehouse. In addition, Ace Corporation employs a third-party wholesaler, AnyCompany Distribution, to supply products to outlets within the state of Louisiana, in the United States.

The administrator enters the Ace Corporation account hierarchy for product distribution into the Siebel database. He includes the details that the Ace Corporation East and West accounts are Distributors and that AnyCompany Distribution is a wholesaler or supplier account for one or more of the Ace Corporation accounts in its product distribution account hierarchy.

He then establishes an authorized product distribution list for the Ace Corporation account product distribution hierarchy that is based on the inclusive distribution option. Both of Ace Corporation's distribution warehouses (Ace Corporation East and West) are given a distribution code of Premium for the category Fizz and a distribution code of Standard for the category Splash. This designation authorizes both warehouses to receive all of his company's beverage products that are part of the Fizz category, independent of product category, and all products in the Splash category that have a distribution code of Standard or Limited. However, because Louisiana bans the sale of alcoholic fruit drinks, the third-party wholesaler in Louisiana is not licensed to distribute them. The administrator gives the wholesaler a distribution code of Limited for the category Fizz, so that only the subset of his company's products that do not contain alcoholic fruit drinks gets shipped to this warehouse.

The key account manager is responsible for managing and updating the authorized product distribution lists, supplier references and source of supply for each of her key accounts. She notes that Ace Corporation East cannot meet the demand for beverage products for all the retail outlets it supplies, so she fulfills those outlets' needs by designating Ace Corporation West as the alternative supplier for those outlets in the account hierarchy for product distribution.

Finally, the key account manager specifies what percentage of the authorized product distribution list each warehouse supplies and designates merchandising locations for several of the products that will be available to Ace Corporation's outlets.