write about trade transition.answer
Answers
Answer:
Trade tradition
Explanation:
Overview:—
Traditional (or general) trade is more prevalent in Asian countries than in North America. However, things are rapidly changing, and unorganized pockets of distribution networks are becoming more and more organized. To continue further, it is important to understand how traditional trade differs from modern trade in terms of distribution and logistics management.
Traditional Trade
Traditional trade is associated with a spread-out distribution network of small retailers, dealers, stockists, wholesalers, and distributors. Its an intricate network which serves localized customer demand through regular orders with short lead times and varying fill rates. Fill rate (fulfillment rate) is the immediate customer demand which can be met with in-stock inventory. It is also calculated in terms of the total order delivered out of the total orders requested. Lead time is the time it takes for a delivery to fulfilled once the order is successfully recorded.
Demand is assessed and interpreted by the retailers and the order is placed. Sometimes, the field agent taking the order is accompanied by the delivery person (in the delivery vehicle) and the order is filled right there.
Traditional trade builds on inter-personal relations between the customers and the retailers. Even the retailers interact in more personal and direct manner with the field agents. The field agents take the orders on behalf of the distributors. The distributors fill the order with a lead time of a day or two. The distributors, in turn, deal with the manufactures to maintain adequate inventory to keep up a healthy fill rate for the orders. The credit cycle extended to these retailers is often short.
Traditional trade is prone to erratic demand which leads to empty shelves or the need to push alternate products onto the customers. This, in turn, leads to quick and ad-hoc orders which put a strain on the schedule planning and last mile delivery for the distributors.