Page 205 - DMGT509_RURAL MARKETING

Rural Marketing

Notes 9. Distributors/wholesalers take up other customer oriented activities like providing leasing
options to the customers, through their Dealers.
10. Boutiques have sprung up in most cities to cater to the elite of the town.

11. Shop-less shops sell products to customers through television shows, computer advertising
and telephone marketing.

10.5 Leasing and Hire Purchase

Twenty-first century has seen great revolution in television and information technology in
India. This has lead to much greater awareness of consumer products among the people. They
are thinking of buying high cost products, which they may not be able to afford. Consumerism,
keeping up with the neighbours is the trend today. Manufacturers and sellers both not only
encourage the trend as it helps them sell more, they also facilitate the buyers by giving them
deferred payment options. For financing purchase by customers, the sellers are taking the help
of finance leasing firms. Now buyers can buy cars, houses and other luxuries without having
ready cash for the purchase. They can get the money from the leasing firms, on interest. The
advantages of lease purchase are given below.
1. As no money is to be paid, or only a token amount is to be paid, the buyer tends to buy
more, many times he buys things, which he really does not want.
2. The buyer buys larger quantity than what he needs.
3. Buyer can possess items much beyond his capacity to purchase and feel good.

4. Buyer can make payments for the purchase as per his capacity to pay on a monthly basis.
5. Products with low brand awareness get sold.
The disadvantages of lease purchase are given below.
1. Buyer buys products he does not want/can not afford.
2. Monthly payments can become a big dent in buyer’s pocket.
3. Sellers may sell to a buyer who does not have the money to pay or may not have intentions
of making the payments. In such a case the seller has to run after the buyer and he may have
to resort to legal action to claim the amount, which is not good for business of the seller.
As in the West, especially in America leasing and hire purchase has become a norm, it is expected
to take further roots in India also.
Firms, who have selected sales through channels rather than their own, salespersons may face
the following situations.

Exclusive Dealer/Distributor

Dealer/distributor should be selling only their products exclusively. In such an event the dealers
are not allowed to sell competitive products. These dealers, therefore, expect the seller to be also
totally loyal to them and not sell their products through any other dealer or channel. The dealer
expects the seller to remain competitive in the market and for this purpose he wants matching
prices, discounts and other terms of business as compare to what the competitors are offering to
their dealers. The seller has to remain vigilant in such situations as mostly the dealer tries to
exaggerate the terms of competition for the better, which may not always be true. Seller needs
to verify these statements from independent sources too.

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