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Creating a customer-oriented distribution offer in the business-to-business market

Granfors Wellemets, Caroline and Sturén, Mikaela (2018) MIOM05
Production Management
Abstract
Problem description: Mature industrial enterprises stand before the challenge of developing
strategies and competitive advantage through their logistics services. The business development within
logistics and distribution services is fast and rapidly changing as the customer experience is becoming
increasingly important and the additional services are becoming an integrated part of the product
offering.
The trends in business and technology are contributing to a structural change as well as a change in
performance requirements of distribution channels in many sectors of business. Thus, many
companies are faced with a complex challenge of reconfiguring its distribution chains. Especially in
the business-to-business market as... (More)
Problem description: Mature industrial enterprises stand before the challenge of developing
strategies and competitive advantage through their logistics services. The business development within
logistics and distribution services is fast and rapidly changing as the customer experience is becoming
increasingly important and the additional services are becoming an integrated part of the product
offering.
The trends in business and technology are contributing to a structural change as well as a change in
performance requirements of distribution channels in many sectors of business. Thus, many
companies are faced with a complex challenge of reconfiguring its distribution chains. Especially in
the business-to-business market as customer expectations rise and the business-to-business market’s
demands and requirements follows similar trends as the business-to-consumer market. There is
therefore a need for mature industrial enterprises to develop strategies to meet customer needs and
restructure the distribution channel in accordance with the requirements of the future.
Purpose: The purpose of the master thesis is to describe and analyze how a commercial enterprise in a
mature industry can develop an attractive and customer-oriented distribution offer in order to gain
market shares and optimize the delivery chain in accordance with future trends.
Methodology: This study is based on a case study of Luna. To fulfill the purpose, a combination of
surveys with the customer, interviews conducted with Luna’s employees and customers and secondary
sources, such as previous studies, market trends and literature review, have been applied.
Theory: To fulfill the purpose, relevant theoretical concepts have been used to form the theoretical
framework, generated from the literature review. The framework begins with Kotler’s Business
Buying Behavior in order to understand who the customer of Luna is, the needs and the market
characteristics. Further, Porter’s model of the Value System was used to define the delivery chain and
how the channel setup may affect a firm’s business. The last two sections concern services in the
delivery chain and what customers consider to be essential for an attractive distribution offer by using
the concept of customer service and delivery service elements.
Empirics: In the empirics, the case company Luna and its organization and business is described. To
understand the business-to-business customer, general trends and market characteristics of the
different customer segments have been discovered. The conducted interviews and reports present the
business buying behavior. Further, the requirements of delivery services and current service solutions
in the delivery chain are conducted together with the findings related to the investigated customer
segments.
Conclusion: The study has concluded that services in the delivery chain are a source of potential
added value for the customer and an opportunity for differentiation for business-to-business
companies in a mature industry. Different customers have different needs, organizational structures
and factors which influence their requirements, thus should the service offer be developed
accordingly. A reconstruction of the distribution channel is thus of relevance and must be made in
order to meet customer demands. As various customers, only within one customer segment, have
showed to have different needs, the delivery options provided to the customers have to increase and
include a flexibility of choice in terms of both delivery time - when - and delivery option - how. As
speed is more important than price, the willingness to pay for added delivery services is found to be
higher than anticipated. Noteworthy, collaborations have been rejected and ended due to the absence
of choice.
The study also concludes that mature industries are behind on many aspects regarding services in the
delivery chain compared to the business-to-consumer market. E-commerce is one parameter and it can
be concluded that the importance is increasing in the business-to-business market. However, future
trends are not so trendy and the focus should lie on other aspects than future technology. (Less)
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author
Granfors Wellemets, Caroline and Sturén, Mikaela
supervisor
organization
course
MIOM05
year
type
M1 - University Diploma
subject
keywords
Business-to-business, Customer-oriented, Delivery chain, Delivery service, Delivery service elements, Distribution channel, Mature industry
other publication id
18/5595
language
English
id
8939251
date added to LUP
2018-05-03 14:48:34
date last changed
2018-05-03 14:48:34
@misc{8939251,
  abstract     = {Problem description: Mature industrial enterprises stand before the challenge of developing
strategies and competitive advantage through their logistics services. The business development within
logistics and distribution services is fast and rapidly changing as the customer experience is becoming
increasingly important and the additional services are becoming an integrated part of the product
offering.
The trends in business and technology are contributing to a structural change as well as a change in
performance requirements of distribution channels in many sectors of business. Thus, many
companies are faced with a complex challenge of reconfiguring its distribution chains. Especially in
the business-to-business market as customer expectations rise and the business-to-business market’s
demands and requirements follows similar trends as the business-to-consumer market. There is
therefore a need for mature industrial enterprises to develop strategies to meet customer needs and
restructure the distribution channel in accordance with the requirements of the future.
Purpose: The purpose of the master thesis is to describe and analyze how a commercial enterprise in a
mature industry can develop an attractive and customer-oriented distribution offer in order to gain
market shares and optimize the delivery chain in accordance with future trends.
Methodology: This study is based on a case study of Luna. To fulfill the purpose, a combination of
surveys with the customer, interviews conducted with Luna’s employees and customers and secondary
sources, such as previous studies, market trends and literature review, have been applied.
Theory: To fulfill the purpose, relevant theoretical concepts have been used to form the theoretical
framework, generated from the literature review. The framework begins with Kotler’s Business
Buying Behavior in order to understand who the customer of Luna is, the needs and the market
characteristics. Further, Porter’s model of the Value System was used to define the delivery chain and
how the channel setup may affect a firm’s business. The last two sections concern services in the
delivery chain and what customers consider to be essential for an attractive distribution offer by using
the concept of customer service and delivery service elements.
Empirics: In the empirics, the case company Luna and its organization and business is described. To
understand the business-to-business customer, general trends and market characteristics of the
different customer segments have been discovered. The conducted interviews and reports present the
business buying behavior. Further, the requirements of delivery services and current service solutions
in the delivery chain are conducted together with the findings related to the investigated customer
segments.
Conclusion: The study has concluded that services in the delivery chain are a source of potential
added value for the customer and an opportunity for differentiation for business-to-business
companies in a mature industry. Different customers have different needs, organizational structures
and factors which influence their requirements, thus should the service offer be developed
accordingly. A reconstruction of the distribution channel is thus of relevance and must be made in
order to meet customer demands. As various customers, only within one customer segment, have
showed to have different needs, the delivery options provided to the customers have to increase and
include a flexibility of choice in terms of both delivery time - when - and delivery option - how. As
speed is more important than price, the willingness to pay for added delivery services is found to be
higher than anticipated. Noteworthy, collaborations have been rejected and ended due to the absence
of choice.
The study also concludes that mature industries are behind on many aspects regarding services in the
delivery chain compared to the business-to-consumer market. E-commerce is one parameter and it can
be concluded that the importance is increasing in the business-to-business market. However, future
trends are not so trendy and the focus should lie on other aspects than future technology.},
  author       = {Granfors Wellemets, Caroline and Sturén, Mikaela},
  keyword      = {Business-to-business,Customer-oriented,Delivery chain,Delivery service,Delivery service elements,Distribution channel,Mature industry},
  language     = {eng},
  note         = {Student Paper},
  title        = {Creating a customer-oriented distribution offer in the business-to-business market},
  year         = {2018},
}