6.3 - Distribution Strategy

6.3.1 How is your product or service going to get to the customers?

Frequently there may be a chain of intermediaries; each passing the product down the chain to the next organization, before it finally reaches the consumer or end-user. This process is known as the 'distribution chain' or the 'channel.' Each of the elements in these chains will have their own specific needs, which the producer must take into account, along with those of the all-important end-user

A number of alternate 'channels' of distribution may be available

• Selling direct, such as via mail order, Internet and telephone sales
• Agent, who typically sells direct on behalf of the producer
• Distributor (also called wholesaler), who sells to retailers
• Retailer (also called dealer or reseller), who sells to end customers
• Advertisement typically used for consumption goods

Quantum Geotechnical Engineering Services has used Direct to Customer method to deliver our service widely. There are some benefits of Direct to Customer method that are

1. Direct-to-customer sales are growing faster than retail overall
2. The most profitable customers buy through multiple channels – store, catalog, online
3. Customers want a uniform brand experience across all channels
4. Impact of shipping cost on order size, shopping cart abandonment
5. Advertising revenue for radio, newspaper is declining, while online ads are nearly
6. Sold out – based largely on the ability to target customers
7. Brands adapt to fit the direct-to-customer space

There is some reason why Direct to Customer method was used at Quantum Geotechnical Engineering Services. One of that it was influenced by where is the market of Direct to Customer is going. Below are some of reasons why Direct to Customer can influence the market

1. Channel conflict is losing it’s influence
2. As affluence increases, the importance of convenience grows
3. Direct-to-customer channel will continue to grow
4. Customers expect a online presence where they can research and buy
5. Customers expect to interact with the brand via email or online
6. Customers will post their opinions and stories about your brand online where everyone can read them
7. Merchants are still learning the nuances of customer acquisition, customer retention, life-time-value, and share-of-customer – all well established principles of direct marketing

6.3.2 What distribution channel is going to be used?

Distribution Channel Strategies is depending on the type of product being distributed there are three common distribution strategies available

1. Intensive distribution: Used commonly to distribute low priced or impulse purchase products example chocolates, soft drinks
2. Exclusive distribution: Involves limiting distribution to a single outlet. The product is usually highly priced, and requires the intermediary to place much detail in its sell. An example of would be the sale of vehicles through exclusive dealers
3. Selective Distribution: A small number of retail outlets are chosen to distribute the product. Selective distribution is common with products such as computers, televisions household appliances, where consumers are willing to shop around and where manufacturers want a large geographical spread

If a manufacturer decides to adopt an exclusive or selective strategy they should select a intermediary which has experience of handling similar products, credible and is known by the target audience

Quantum Geotechnical Engineering Services has decided to use exclusive distribution based on some reasons :-

1. In an exclusive distribution, Quantum Geotechnical Engineering Services and client agree that the client will deal exclusively with Quantum Geotechnical Engineering Services for any inconvenience or dissatisfaction of our service
2. Exclusive distribution strategy was used by Quantum Geotechnical Engineering Services because of high-priced services, whereby Quantum Geotechnical Engineering Services grant certain dealers exclusive territorial rights to sell the site investigation report
3. Exclusive distribution gives Quantum Geotechnical Engineering Services greater control over the way the service is done either for lab testing or compilation of report
4. Exclusive distribution was chosen because Quantum Geotechnical Engineering Services have just one outlet in a relatively large area. Exclusive distribution is suitable because products purchased from Quantum Geotechnical Engineering Services is infrequently, and service from Quantum Geotechnical Engineering Services was classified as a last for a long time
5. Quantum Geotechnical Engineering Services choose the exclusive distribution because no one able to undercut them. (Place Utility)
6. Exclusive distribution tends to be used to introduce new company like Quantum Geotechnical Engineering Services, and then change when market is more competitive (Move from introduction to the growth stage of the product life cycle

6.3.3 What are the delivery term ? How will the distribution method affect production time frame or delivery ?

For your information, the duration for the delivery service to the customer is depending on type of test and the type of soil. Normally, to get the final result after test, the overall duration for a certain project is maximum 1 month. In case that there have a trouble in the site area, the duration is depend on the site problem. A certain case, to get the final result, the duration is reach to 2 to 3 month. More detail on the delivery term of our services are as follows :-

The delivery can be divided into 4 zone which are :
North zone - include Pulau Pinang, Kedah, Perlis
South zone - include Johor, Melaka, Negeri Sembilan
West zone - include Kuala Lumpur, Selangor
East zone - include Terengganu, Kelantan & Pahang

The delivery terms by zone :-

North Zone - Within 5 days
South Zone - Within 4 days
West Zone - Within 3 days
East Zone - Within 2 days

* After complete all the laboratory test


6.3.4 How are your products to be package for shipping and for display ?

6.3.5 Does the packaging meet all regulatory requirements?

Quantum Geotechnical Engineering Services Sdn. Bhd. (QGES) is provided a service in the geotechnical engineering works and testing either laboratory or field testing. As the final result, we will produce the report from the testing

To make sure the quality of product fulfill requirements of ISO/IEC Guide 25 (1990), our laboratories will assesses, accredits and monitors by Skim Akreditasi Makmal Malaysia (SAMM). Other than that, the testing and report requirement are follow the standard of Jabatan Kerja Raya (JKR)

In the process of completing the report, all the data and results of the testing and design have been done must endorse by Laboratory Executive and Senior Engineer. This is to make sure that the work is control by experienced and expertise officer


6.3.6 Is the packaging appropriate coded, priced and complimentary to the product.

The product of our company will coded by using Reference Series No. Every project that get will give Reference Series No to help our company to manage or refer if any problems occurs. For examples

The price of services is depends on:-

The size of the project
Size of the project will decide number of testing have to do. Big project will have high cost. This is because it has to do more detail and more point has to test

Type of testing done
Every test has its own difficulty. Beside that, each test will used different apparatus and tools. So, the price is different for each test.

Condition of site for field testing
Condition of site such as the accessibility, geologic feature, vegetation and others will affect the difficulty of the field testing

Design for geotechnical structure.
There are four design services that provide are foundation, retaining wall, soil improvement and geo-materials. This service is add-on to the other two services which is the information from the testing will be used in design the structures


6.3.7 What minimum inventory level must be maintained to ensure that there is no loss of sales due to problems such as late shipment and back orders?

For shipping process, our company use ‘Safe Trade Shipping’ in purpose to make sure the report will delivered on time. Our company had cooperated with courier services company to do shipping work. In Safe Trade Shipping, courier services company inform our company when the report had been delivered to customer. Means that, progress during the shipping process will be inform to our company. Therefore, we can make sure that the product is delivered to the customer