En Company Marketing Channels Research

The quartz industry in China started in 1960s and witnessed a gradual development in 1970s, with a very low processing and equipping level. Thanks to the Reform and Opening-up police in China, the quartz glass industry saw a rapid development in late 1980s. With modernized production, more advanced technique and processing way, and better equipment, the quartz glass industry entered a new development phase. The demand for the quartz glass grew rapidly. The sales growth rate is 25% to 30% and the sales revenue was up to 2.4 billion domestically in 2007. Due to the impacts of the financial crisis in 2009, economic growth was slowed down. However, a good prospect can still be expected in the quartz glass market.ZH Company is a small and medium-sized enterprise owned by the State and it has 45 years of experience in quartz glass production. After experiencing the splendid time of the planned economy and the recession time of the market economy, in late 1960s, the Company made an adjustment to the sales department by re-segmenting the market and improving the marketing management. This brought a sharp increase of sales revenue thereafter. However, the sales revenue was stagnant in the past five years. More badly, its sales revenue hit a record low in the past five years under the impacts of the financial crisis in 2008, although its rivals didn't see a good result neither. Amid fierce competition in the market, distribution channel is getting even more important for small and medium-sized enterprises. It has become a common sense for manufacturers to get a better knowing of the distribution channel so as to turn themselves to winners in the market. The direct-sale model adopted by the ZH Company for a long time overemphasized the relationship marketing while ignored the importance of establishing marketing channel. The direct-sale alone can never help to find a way out for the current weak marketing. Therefore, it is urgent for the ZH Company to analyze the problems existing in the current distribution channels, improve the traditional channel model and find a solution according to the company's present condition.This thesis tries to find out a sales channel proper for the ZH Company and establish a standard and grading system for selecting distribution members, based on the research on the current situation of sales in the ZH Company, as well as the analysis on the domestic quartz glass market. To this end, based on the classic channel strategy theories, the thesis employs many methods, such as Transaction Cost Analysis,The characteristics of Goods and Parallel System Theories and Scoring for Important Factors. Moreover, it gives some recommendations for the resolution to possible conflicts in the future, which serves as a reference for ZH Company in the way to improving its marketing situation.