Channel Conflict Case Study

735 Words3 Pages
CHANNEL CONFLICTS – Some amount of competition between channel members is not necessarily an undesirable thing and given the interdependence among various channels, some amount of conflict is sometimes unavoidable. However, it is important to eliminate pathological conflict. There are various reasons why a channel conflict may exist. These are namely – 1) Goal incompatibility among channel members 2) Lack of agreement over domain issues such as the target population to be served, territory to be covered, technology used in promotions or type of functions required to be performed by channel members 3) Incongruence in the channel members’ perception of reality. Goal conflict usually stems from channel members treating running the channel as…show more content…
Most purchases for personal consumption especially among tier 2 and 3 towns happen at private retail/wholesale shops that offer a more competitive price. These high end Retail outlets can be rewarded for investing in the company’s brand or for ensuring some degree of exclusivity in serving on the company’s product line as against other competitive offerings. This way the company can leverage its referent power. The company can give some degree of selectivity in-terms of customer accounts or regions to be served in return for greater cooperation and final sales by company dealers and low end retail outlets. Since availability plays a crucial role in performance of these Wine and Beer products at restaurants, it is important to offer incentives such as a large credit window, sale or return contracts but with a minimum order quantity mandated to help the company maintain good relations with these channel…show more content…
To avoid ambiguity there should be a steady flow of advice from the UBL leadership to all of its various channel partners on market conditions, inventory levels, possible new product launches etc. This will ensure that congruent goal strategies are implemented and conflicts among channel members are avoided. This also helps offset the possibility of friction should the company starts its own distribution channel in addition to engaging with 3rd party platers. UBL leadership can also create high level strategic goals that revolve around greater customer satisfaction or increasing market share, which can basically create a win-win situation for all channel
Open Document