International Distribution Case Study

company has the chance of expanding its market coverage thus gaining more chances of globalizing its services.

International Distribution Systems

The variety of the distribution system results in the most complex problems for international marketers. Japan has the most complex system while The United States have a more standardized one. Global retailing is influenced by a number of factors. These include high operating costs, strict regulation on the store development, recession and saturation in home country. The use of e-commerce in international distribution has a number of advantages. According to Slangen and Dikova (2014), it offers the customers with greater choice, lowers the cost of transactions, brings customers closer to the market

Though the organization type, performing different functions vary from the type of the channel used and the functions of the channels. Channels ensure provision of time ownership and place utility to the product. Through them, products and services are made available where, when and the quantities that the different customers want them to be. A number of physical distribution or logistics functions are provide by the distribution channels on a worldwide capacity (Katsikeas, 2014).

The distribution channels enhance marketing of goods through reduction in the number of transactions that is required for the availability of the goods to the final customers. Two major ways are involved in this case, the breaking bulk and the creation assortments (Katsikeas, 2014). In breaking bulk, the retailers and the wholesalers buy large sum of goods from the companies and sell them bit by bit to the various customers in different places. Other values associated with distribution are negotiations, promotion of goods and matching of the offers to meet every need of the

One of the ABB’s strategies is to integrate full operations such as building of local engineering and manufacturing industries. This has led to the achievement of economies of scale and full synergy. The financial crisis that occurred in Asia towards the end of the 20th century did not affect China. This gave ABB the opportunity to extensively expand its operations in the Asian continent and later to other parts of the world.

The success has been owed to various other factors among them being its good market position in the Chinese economy, its good performance, autonomy and delivery of services (Akgün et al., 2014). ABB as a company ensures it is close to customers by meeting all the local requirements of these customers. The main challenge for the ABB Company in its operation in China is that, it cannot use standard contract in engaging with customers. The company thus has to be responsive to its customers’ needs to maintain its success locally thus facilitating its international market