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Distribution Channels at Clothing Retailer Hennes Mauritz A key ingredient in retailing success is the strength of a companys distribution channels Kerry Capells 2002 Business Week article looks at Sweden-based Hennes Mauritzs HM sourcing and inventory management strategies and their reliance on distribution channel partners HM has developed a unique distribution channel strategy to compete with better entrenched retailers including Gap Old Navy Zara and FCUK HM Product Strategy Understanding HMs distribution strategy requires a clear understanding of their product philosophy and strategy Like Gap and other clothing retailers HM markets to a particular segment of the fashion consumer market HMs philosophy is Fashion and quality at the best price HM 2004 HM keeps up with its competitors by providing a variety of styles from updated classics and fashion basics to cutting-edge fashion trends HM 2004 Kotler defines the product as a combination of goods and services Kotler et al 2001 HM seeks a product edge by providing affordable fashion lines similar to its competitors but with a fast turnaround from design to production to sales floor Capell 2002 Capell focused on this integrated distribution channel in his article Distribution Channel Outline Marketers often refer to the fourth P place as placement logistics or distribution Marketers must create a place or a way for logistics and physical delivery to get a product to market and into the hands of target consumers McColl-Kennedy and Kiel 2003 A distribution channel refers to the type of intermediary or linkage between producers and consumers A one-channel distribution network involves only the retailer between producer and consumer Direct distribution occurs when the producer directly supplies the product to the buyer The choice of distribution channel depends on a variety of factors including the type of product While not all clothing retailers use direct distribution models HM and its competitors in the low- and mid-range clothing market use this model to maintain low costs and a fast time to
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