流通問題의 認識方法과 流通近代化의 方向 : 流通活動에 관한 SYSTEMS APPROACH의 試圖 = A Systems Approach to the Distribution Channels in Korea
Ⅰ. INTRODUCTION
In Korea, the period of the 1960's was a time of major changes in the social and political environment. This period saw the government begin to organize a modern economic structure and to develop economic policies on a large scale, that is, the First and Second Five-Year Economic Development Plans.
These caused national outputs to grow rapidly-221.7 per cent increase during the period. Such an economic climate places heavy burdens on marketing activities. Continuous production is accompanied with increasing marketing responsibilities. Yet, marketing is constantly criticized for high costs, wastes, and inefficiencies. In fact, marketing occupies a critical role in respect to the development of developing countries. But it is in itself in every one of these the least developed, the most backward part of the economic system. If we want economic development in freedom and responsibility, We have to build it on the development of marketing.
There is another reason why distributive system should be developed. It is a cost reduction. Prices soared to 295.8 per cent during the period of 1960-1969. Indeed distribution cost are a potent influence on prices of consumer's goods. As distribution has been termed the dark continent of the economy, increasing attention has not be paid on this distribution problem.
Ⅱ. DISTRIBUTION SYSTEM IN KOREA
A. Role of commerce
In the course of five years, commerce did jump in absolute terms; from 100 in 1965 to 217 in 1970. This index of growth compares favorably with the growth of the manufactural sector (266) which have direct effects on commerce and increase the volume of goods in the economy.
The proportion of commerce in GNP has grown steadily from 14.8 per cent in 1965 to 18.2 per cent in 1970. Distribution industry in the broadest sense, which embraces such sectors as wholesaling, retailing, storage, transportation, and communication, climbed from 18.8 per cent in 1965 to 23.6 per cent in 1970.
Additional light is thrown upon the position if distribution industry by the number of persons employed. The percentage of employees of this industry increased highly; from 14 per cent in 1965 to 16 per cent in 1970. This proportion (16% in 1970) is superior to that of manufacturing (13% in 1970).
From the data, we can easily understand that the distribution industry is very important position in the economy, even though it is next to manufacturing.
B. The Characteristics of the system
(1) A structural side ;
A long channel - high vertical specialization
A multiple channel - high horizontal specialization
A very infant scale - output, the number of employees, and selling space of store are all very small
A superabundance of wholesalers - approximately 1 of 18 retailers
A excess of retailers - about 19 families per store
A Low productivity - the ratio of commerce to manufacturing is 1:1.8
(2) A behavioral side ;
A very conservative attitudes in business practical - a custom follower not a custom breaker
A negative action to risk-taking
A bargaining by rather human touch then a reasonable contract
Ⅲ. MODERNIZATION OF DISTRIBUTION SYSTEM
A. system thinking
Chart Ⅰ illustrates the key role of distribution system in the economy. The economic system consists of three subsystems, that is, production, distribution, and consumption system. The distribution system(Se) essentially comprises of two subsystems. One is channel system, and the other is concerned with physical distribution system. The former will receive the major focus in our discussion.
The channel system is further divided into two subsystems ; wholesaling ans retailing systems.
CHARTⅠ A Total System of an Economy
Se
Sd
X Sp Sd₁ Sc Y
Sd₂
feedback
where, X-Input (resources)
Y-Output (customer satisfaction)
Se- The economic system
Sd-The Distribution system
Sd₁- The Channel System
Sd₂- The Physical Distribution System
Sc-The Consumption System
B. How it should Be Modernized
The objective of the distribution system is how to increase the outputs effiectively (see ChartⅡ). then, in order to raise outputs our distribution system must be modernized into a more efficient and larger scale.
ChartⅡ Input-output of this Distribution System
INPUT PROCESS OUTPUT
Distribution Efforts Operations of the total distribution system Profits through customer satisfactions
Channels (men facilities) Time and costs reduction
Physical distribution Adequate merchandising, etc.
Communication
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