Basic Marketing: A Global Managerial Approach

Perreault−McCarthy: Basic

Marketing: A

Global−Managerial

Approach, 14/e

13. Retailers, Wholesalers
    and Their Strategy
    Planning

Text © The McGraw−Hill

Companies, 2002

384 Chapter 13

expand their reach by using the Internet. As the Internet causes consolidation, it

will also provide more value. A smaller number of cyber-brokers will cut costs and

dominate the business with larger databases of buyers and sellers.

Selling agentstake over the whole marketing job of producers—not just the sell-

ing function. A selling agent may handle the entire output of one or more

producers—even competing producers—with almost complete control of pricing,

selling, and advertising. In effect, the agent becomes each producer’s marketing

manager.

Financial trouble is one of the main reasons a producer calls in a selling agent.

The selling agent may provide working capital but may also take over the affairs of

the business. But selling agents also work internationally. A combination export

manageris a blend of manufacturers’ agent and selling agent—handling the entire

export function for several producers of similar but noncompeting lines.

Auction companiesprovide a place where buyers and sellers can come together and

bid to complete a transaction. There aren’t many auction companies. Traditionally they

have been important in certain lines—such as livestock, fur, tobacco, and used cars.

For these products, demand and supply conditions change rapidly—and the product

must be seen to be evaluated. The auction company brings buyers and sellers together.

Buyers inspect the products—then demand and supply interact to determine the price.

Aucnet is a good example of a progressive auction company that put the bid

process on the Internet. Its very successful used car auction runs from a website

(www.aucnet.com). The key to its success is that it provides bidders with a very

thorough online rating of the quality of each car. In the past, most auction com-

panies said “What you see is what you get.” Because the ratings add value and are

credible, Aucnet attracts dealers from all over the country. That results in higher

bid prices and better profits for Aucnet. But it also saves dealers the cost and has-

sle of going to smaller local auctions that don’t have what they want. The Internet

has spurred growth of all sorts of auction companies in lines of business where

auctions have previously not been common.^35

A few years ago wholesale
brokers typically focused on a
few specialized product
categories, but now online
brokers are finding markets for
almost every sort of product.

Auction companies—
speed up the sale

Selling agents—almost
marketing managers