Designing and Explaining a Model of Marketing and Sales Strategies in the Food Distribution Industry

Document Type : Research Paper

Authors

1 Associate Prof., Faculty member of Management and Accounting, Allameh Tabataba'i University, Tehran, Iran

2 Ph.D. Candidate in Strategic Management, Allameh Tabataba'i University, Tehran, Iran

Abstract

Introduction: The distribution industry, especially the food distribution industry, is considered as a significant part of the economy due to its huge revenue generation. This industry is of great importance in the field of operation and research for the vitality of food supply, continuous changes in consumer behavior, multiple intermediaries from producer to consumer, exorbitant distribution costs, high revenue generation, growth opportunities, and technological developments. In the field of food distribution, the most important decisions are related to marketing, sales, and distribution policies, which directly affect the company's performance, the quality of customer service, and profitability. The distribution industry in Iran faces many problems such as high marketing and distribution costs, high transaction costs, lack of competition, traditional processes, lack of information transparency, increased transportation costs, low efficiency of the distribution network, the existence of monopolies in some products and unfair business practices. Moreover, distribution companies in Iran do not know enough about the importance of developing appropriate strategies for their distribution channels. This has harmful consequences for them.
The purpose of this study is to provide a model for developing a marketing and sales strategy for companies active in the food distribution industry. The model seeks to overcome some of the limitations in the field of research and implementation. The importance of the research topic can be attributed to the dearth of research in the field of distribution, development of a coherent marketing and sales strategy, and coordination and implementation of sales and marketing strategies to achieve the goal. It also pays attention to different economic conditions in marketing strategy, differences in recession and business boom strategies, decreasing distribution costs, short-sighted copying of competitors' strategies, high turnover of the food distribution industry, competition in satisfying customer needs, attracting new customers and completing marketing and sales knowledge. So, it is generally a response to the question ‘What is the model of marketing and sales strategies in the food distribution industry’? In order to give a rational answer to this question, three prerequisite questions are being answered: 1) What are the components of a marketing and sales model in the Iranian food distribution industry?, 2) What are the relationships between these components?, and 3) Which of the identified indicators in the sales and marketing strategy model has the greatest impact on the development of marketing and sales strategies in the Iranian food distribution industry?
Methodology: This study is of a descriptive and exploratory type based on a mixed method. The qualitative part of the research was done using content analysis and the views of 11 executive and academic experts. Three criteria were considered for selecting the sample members, including at least six years of experience in the distribution industry, the position of CEO or marketing or strategy director, and a minimum master's degree in the field of industrial management or engineering. The analysis of the qualitative data was done based on the sentences, words, themes and terms of the experts in the field of marketing, sales and distribution of the food distribution industry. It led to the extraction of 135 final codes.
It was done by combining the review of the literature and the qualitative study in the form of the final research model with all its variables, components, and indicators. In this part, 81 questionnaires were distributed among the marketing and sales managers of 54 distribution companies in Iran. The data were analyzed by the structural equation modeling method.
Results and Discussion: In response to the main research question, we find that developing a sales strategy in food distribution companies without considering the marketing strategy and its components is irrational. According to the research literature and the opinion of distribution industry experts, the issue that exists in most food distribution companies in Iran is the separation between marketing and sales units and strategies. This is always considered a serious challenge. According to experts, neither of these two methods alone can be effective. Also, the obtained model shows that, in order to gain a competitive advantage during the post-stagnation period, first, marketing strategies should be considered as the basis for developing sales strategies. Also, the major factors affecting the distribution industry during the post-stagnation period should be taken into account. The external conditions of the company (e.g., threats and opportunities) should not be overlooked.
Conclusion:  In order to have a dynamic and successful food distribution industry, while achieving financial goals for companies that can lead to consumer satisfaction, distribution companies must adopt a broad marketing strategy that takes into account the factors related to marketing goals such as pricing strategy, distribution strategy, competitive advantage, resource allocation, understanding of food purchasing behavior, goals territory, promotion strategy, understanding of the macro environment of the distribution industry and market research and development. Also, sales strategy must take into account the sales team performance, sales team relationship, transformational leadership, coordination between sales strategy and marketing, customer satisfaction, sales team training, use of sales technology, use of sales channels, receipt of receivables, customer segmentation, blue ocean strategy and attention to the future of the sales business. There must be a care for the strengths and weaknesses of the company, the threats and opportunities arising from competitors and macro factors affecting the food distribution industry in post-stagnation era as well.

Keywords

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Journal of Business Administration Researches
Volume 13, Issue 25
August 2021
Pages 331-369

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