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Article

Eugene H. Fram

Highlights the importance of selecting the correct internationaldistributors if a firm wishes to trade effectively in the wider market.Describes a study commissioned…

Abstract

Highlights the importance of selecting the correct international distributors if a firm wishes to trade effectively in the wider market. Describes a study commissioned exploring the steps required to minimize the risk when selecting a distributor, e.g. use of end‐user references and suggestions. Concludes that firms need to develop an effective procedure for selecting distributors, utilizing management attention and objectivity to decide on the key factors involved.

Details

Journal of Business & Industrial Marketing, vol. 7 no. 2
Type: Research Article
ISSN: 0885-8624

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Article

Ricardo Ernst and Morris A. Cohen

Analyses the operational implications of marketing strategies thattry to distinguish between high‐ and low‐priority customers. For ahigh‐priority customer, the distributor

Abstract

Analyses the operational implications of marketing strategies that try to distinguish between high‐ and low‐priority customers. For a high‐priority customer, the distributor is willing to expedite an order from any emergency source. For a low‐priority customer, on the other hand, distributors will back‐order demand. Bases results on a normative model of dealer behaviour developed by the authors. The distributors are assumed to follow a periodic‐review, stochastic‐demand (s, S) inventory control policy. The principal constraint is a minimum level of service (fill rate) which reflects the objectives of the manufacturer. Bases the analysis on a complete experimental design where a distinction is made between exogenous (replenishment lead time and expedite cost) and endogenous (achieved service level and customer prioritization) variables. In addition, identifies small and large distributors as a function of the demand parameters. Results highlight policy options available to the manufacturer to increase the service level of the system, and these are dependent on the size and competitiveness of the market.

Details

International Journal of Operations & Production Management, vol. 12 no. 3
Type: Research Article
ISSN: 0144-3577

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Case study

Muhammad Muzamil Sattar and Farhan Shahzad

The learning outcomes of this paper are as follows: understanding the complexities of persuading a distributor to increase investments in the Pakistani fast moving…

Abstract

Learning outcomes

The learning outcomes of this paper are as follows: understanding the complexities of persuading a distributor to increase investments in the Pakistani fast moving consumer goods (FMCG) context. Understanding the data handled by an area sales manager (ASM) for effective territory management, along with the path taken for a focused approach to territory growth. Comparing the distinct perspectives of a company and an intermediary (e.g. distributor) who are pursuing similar business goals. Experiencing hands-on calculations of return on investment (ROI) for a distributor, in a straightforward situation.

Case overview/synopsis

In June 2015, Shah Mir, an ASM at PurePack Pakistan, was face-to-face with an irate distributor named Amir Kazmi, who ran Kazmi Agency in Sukkur, Sindh. PurePack Pakistan, a multinational organization dealing with FMCG products, had a turnover of approximately PKR 7.5bn1 and was a fully owned subsidiary of PurePack Limited, UAE. Shah’s predecessor, Noor Azam, had managed the central Sindh territory very well and had recorded phenomenal growth. The retail outlet coverage had increased during Noor’s time, along with Amir’s investment in the territory. Knowing he was up against an outstanding past achievement, Shah had studied the data of the area and Kazmi Agency’s performance for the past two years and had concluded that there was still greater potential in the area. Amir Kazmi, owner of Kazmi Agency, was an astute businessman who visited his Sukkur market regularly. He knew the distribution business well and had benefitted from it. He was fully aware of the importance of working on relationships with his retailers in the FMCG industry because competition was high and loyalties needed to be nurtured. Like any businessperson, he was concerned about the growth and profitability of his business. Kazmi’s business had increased quite rapidly from a turnover of around PKR 8.7m in 2008 to one of around PKR 54m in 2014, indicating the potential in the Sukkur district. Shah, who was new to the territory and early in his career, was still grappling with the fact that the growth in central Sindh had been phenomenal and that expectations were high for him. He had gotten working on the territory while keeping in mind advice from his boss, Nabeel Asad, who had told him to identify one area at a time so that he could go about achieving his growth targets in a focused manner. This case brings out the challenges that young ASMs face while in the field, when they have to deal with experienced distributors in the Pakistani retail trade, especially in the smaller towns where relationships can greatly affect business. Students will gain an understanding of the key performance indicators required to focus on developmental issues in a territory. It will enable students to appreciate financial considerations as a major tool in dealing with intermediaries (distributors, in this case) and get hands-on experience in a method of convincing a distributor of his past investments and profitability and paving the way for further investment for retail expansion.

Complexity academic level

This case is designed for use at the postgraduate level in sales management, channel management and strategic marketing courses, as well as in executive management programs. It can be used at later stages of a course and show a link between a company’s requirements and a distributor’s goals. The students should have field experience or aspire to get into roles dealing with intermediaries, such as distributors. The case gives students a practical, hands-on experience in working on simple profitability calculations and pushes them to challenge the assumptions that need to be made. The case attempts to trigger a discussion on distributor management and its challenges in Pakistan, where managing relationships while keeping in mind the business perspective is imperative. Identifying the right geographical territories to focus on and working on the financials of the distributor are the key learning deliverables. The case is accompanied by a spreadsheet with calculations. This spreadsheet is for the instructor’s use and is for demonstrating calculations as the class progresses. By using the spreadsheet, the instructor can practically demonstrate the effects that changes in investments, expenses, etc. have on the distributor’s profits. It can even be used to build a far more complex situation than the one given in the case (advice for which is provided in this teaching note).

Subject code

CSS 8: Marketing.

Supplementary materials

Teaching notes are available for educators only.

Details

Emerald Emerging Markets Case Studies, vol. 11 no. 1
Type: Case Study
ISSN: 2045-0621

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Book part

Chwo-Ming J. Yu, Hsiao-Wen Lin and Hui-Yun Chiu

In recent years, many firms from developing countries (LDCs) have engaged in foreign direct investment (FDI). Interestingly some of these firms locate their investments in…

Abstract

In recent years, many firms from developing countries (LDCs) have engaged in foreign direct investment (FDI). Interestingly some of these firms locate their investments in developed countries (DCs) (i.e., upstream FDI), instead of in countries economically similar to or less than their home countries (i.e., downstream FDI). However, only a few researchers have examined the issues related to upstream FDI. Furthermore, when examining FDI, most studies have focused on manufacturing subsidiaries but paid less attention to sales subsidiaries. Due to the differences in nature, management of manufacturing and sales subsidiaries should be different. Using a case study approach and focusing on the behaviors of Taiwanese firms, we address two research questions: (1) what are the channel strategies adopted by the sales subsidiaries of Taiwanese high-tech firms (i.e., multinational corporations (MNCs) from LDCs (LDCMNCs)) in DCs? and (2) how do these subsidiaries manage their channels in DCs? Our findings are: (1) LDCMNCs tend to use multiple sales channels, to work with large national distributors, and to adopt high touch channels to market products in DCs; (2) to reduce channel conflict, less powerful LDCMNCs tend to adopt multiple independent channel system, instead of dual channel system; and (3) due to limited resources, LDCMNCs make more effort on designing channel conflict prevention mechanisms than designing channel conflict resolution mechanisms, emphasize more on building relationships with distributors and tend to use financial incentives/high-power incentives than use other types of incentives to motivate distributors. The findings of this study are helpful for LDC firms to operate their sales subsidiaries more effectively in DCs.

Details

International Marketing in Rapidly Changing Environments
Type: Book
ISBN: 978-1-78190-896-9

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Book part

Daniel F Jennings and Kevin G Hindle

Zahra and Covin (1995, p. 46) report that “the current interest in corporate entrepreneurship arises from its potential usefulness as a means for renewing established…

Abstract

Zahra and Covin (1995, p. 46) report that “the current interest in corporate entrepreneurship arises from its potential usefulness as a means for renewing established organizations and increasing their ability to compete in their chosen markets.” In addition, a number of researchers support a contention made by Schollhamer (1982, p. 82), that “corporate entrepreneurship is a key element for gaining competitive advantage and consequently greater financial strength” (Covin & Slevin, 1991; Peters & Waterman, 1982; Zahra & Covin, 1995). Interestingly, however, other researchers argue that corporate entrepreneurship can be risky and may be detrimental to a firm’s short-term financial performance (Burgelman & Scales, 1986; Fast, 1981).

Details

Advances in Entrepreneurship, Firm Emergence and Growth
Type: Book
ISBN: 978-1-84950-267-2

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Article

Guangkuan Deng, Jianyu Zhang and Zhiwen Fan

In this paper, extending the research on the positive effects of marketing channel conflicts, this paper aims to examine how functional and dysfunctional conflicts…

Abstract

Purpose

In this paper, extending the research on the positive effects of marketing channel conflicts, this paper aims to examine how functional and dysfunctional conflicts influence channel innovation capability by triggering channel cohesion and investigate the moderating role of a distributor’s network structure.

Design/methodology/approach

Based on social network theory and Coser’s conflict theory, this paper develops a framework, tested using Chinese manufacturers’ data, which incorporated six key variables, namely, functional conflict, dysfunctional conflict, channel cohesion, channel innovation capability, network density and network centrality.

Findings

The empirical results revealed that functional conflict can arouse channel cohesion and that distributor network density and centrality positively moderates this relationship; dysfunctional conflict negatively affects channel cohesion, but distributor network density negatively moderates this relationship; channel cohesion had a mediating effect on the relationship between channel conflict and channel innovation capability.

Originality/value

This paper contributes to the research on channel conflict by incorporating the entire channel system’s innovation capability as a positive consequence of channel conflict and expands the channel conflict literature that adopts a network structure perspective.

Details

Nankai Business Review International, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 2040-8749

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Article

Rashmi Dyondi, Shishir Kumar Jha and Arunima Haldar

This paper aims to examine the strategic issues of risk for independent theatrical film distributors in the Hindi film industry in India.

Abstract

Purpose

This paper aims to examine the strategic issues of risk for independent theatrical film distributors in the Hindi film industry in India.

Design/methodology/approach

The study adopted qualitative grounded theory approach to explore contextually relevant strategic issues of risk for independent theatrical film distributors. Semi-structured in-depth interviews with Hindi film distributors helped to gain explorative insights about the risk behaviour of film distributors operating in Mumbai “circuit”.

Findings

The findings suggest that risk faced by distributors is a function of product (film content) features, contractual terms, resources such as finance and strength of strategic alliances with the producers. The study develops a business risk model for the film distributors from a series of propositions.

Originality/value

The paper contributes to the literature on motion picture industry by highlighting the importance of distribution risk in the film value chain.

Details

International Journal of Organizational Analysis, vol. 29 no. 2
Type: Research Article
ISSN: 1934-8835

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Article

Yi Liu, Ting Liu, Yuan Li and Liyang Ruan

Previous studies have investigated the influence strategy–economic satisfaction links within a pairwise framework. This study aims to reexamine this issue in a network…

Abstract

Purpose

Previous studies have investigated the influence strategy–economic satisfaction links within a pairwise framework. This study aims to reexamine this issue in a network context from both the structural and relational embeddedness perspectives.

Design/methodology/approach

An ego network approach in which the network consists of a focal distributor, other distributors and alternate manufacturers is adopted to measure the distributor’s network. Drawing on data from 124 distributors from China’s tire industry, a hierarchical multiple regression analysis is used to test the hypotheses.

Findings

The empirical results find a positive relationship between a manufacturer’s noncoercive influence strategies and the distributor’s economic satisfaction and an inverse U-shaped relationship between coercive influence strategies and economic satisfaction. It discusses the joint effects of coercive and noncoercive influence strategies and finds that the former mitigate the positive effects of the latter and that the latter flatten the inverse-U shaped effect of the former. Further, when a distributor spans rich structural holes, the effects of coercive and noncoercive influence strategies on economic satisfaction weaken. When a distributor has strong ties with its network members, the effects of noncoercive influence strategies are mitigated, while the effects of coercive influence strategies are enhanced.

Practical implications

This study provides implications for manufacturers, particularly concerning how to properly exert influence strategies to improve distributors’ economic satisfaction. Manufacturers should consider the attributes of the networks in which the distributors are embedded, involving structural holes and tie strength. They should also carefully use the two influence strategies simultaneously.

Originality/value

This study contributes to the influence strategy literature by incorporating a network perspective by empirically examining the different moderating effects of structural holes and tie strength; provides a new and powerful explanation for the effects that coercive influence strategies have on economic satisfaction by testing an inverse U-shaped effect; and examines the effects of the interaction of two strategies.

Details

Journal of Business & Industrial Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0885-8624

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Article

Amparo Kuster-Boluda, Natalia Vila Vila and Ines Kuster

Complaint management is at the heart of customer relationship management. While many studies have analyzed a client’s complaint behavior in business-to-business (B2B…

Abstract

Purpose

Complaint management is at the heart of customer relationship management. While many studies have analyzed a client’s complaint behavior in business-to-business (B2B) relationships, there is a lack of research in the study of complaints by distributors from different countries. The purpose of this paper is to explain the following two main objectives: to analyze if the complaint management strategy of a manufacturer varies depending on the type of international distributor used (indirect exporters, direct exporters and commercial subsidiaries); and to analyze the potential effects of complaint management on the satisfaction and fidelity of distributors and the quantity of complaints that they put.

Design/methodology/approach

A stratified probabilistic sampling method was used, dividing the entire population of distributors of a leading Spanish manufacturer into three different groups. In total, 79 valid responses were obtained as follows: 24 per cent from indirect exporters (organizational commitment Grade 1), 68 per cent from direct exporters (organizational commitment Grade 2) and 8 per cent from commercial subsidiaries (organizational commitment Grade 3). Partial least squares were used to analyze the proposed relationships.

Findings

The results have confirmed that the procedure for resolving the complaint and its length (resolution time) depends on the seriousness of the complaint (the type of complaint). In turn, the resolution of the complaint influences the satisfaction of the vendor and the latter will influence its fidelity. Regarding the number of complaints, those distributors with the highest number of complaints satisfactorily resolved are those who remain loyal to the company. On the contrary, it is not possible to affirm that the type of distribution channel affects the types of complaints that are presented. Different kinds of distributors of the same manufacturer (indirect exporters, direct exporters and commercial subsidiaries) complain equally. In addition, those whose complaints take longer to resolve are not significantly less satisfied. Even more, low-satisfied distributors will present more complaints than the most satisfied ones.

Originality/value

First, this study investigates if different kinds of distributors with different international commitments (indirect exporting, direct exporting and commercial subsidiary) behave differently in terms of claims and complaints. Second, this paper analyzes the role of complaint management in international B2B relations to improve distributors' satisfaction and loyalty; but considering the join impact of three dimensions of a successful complaint management strategy that literature usually has examined separately as follows: what (the type of complaint), how it is resolved (management procedure) and when it is closed (duration).

Details

Journal of Business & Industrial Marketing, vol. 35 no. 11
Type: Research Article
ISSN: 0885-8624

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Article

Chao Feng, Guijun Zhuang, Hui Chen and Daxian Hu

Based on social network theory and the literature of contract governance, the purpose of this study is to explore how distributors’ “banding together” (network intensity…

Abstract

Purpose

Based on social network theory and the literature of contract governance, the purpose of this study is to explore how distributors’ “banding together” (network intensity) affects contract governance (detailed contracts), which, in turn, influences channel conflict and simultaneously tests the moderating effect of network centrality.

Design/methodology/approach

The authors collect the data from the side of 288 manufacturers.

Findings

This study finds that, first, distributors’ network intensity positively affects detailed contracts between manufacturers and distributors; second, detailed contracts, in turn, declines channel conflict; and third, network centrality will weaken the positive influence of network density on detailed contracts. In addition, an ex post analysis finds that detailed contracts play a negative mediating role between distributors’ network density and channel conflict and this negative mediating effect would be weakened by distributors’ network centrality.

Originality/value

The current study not only helps to make up for the shortcomings of using the dyadic analysis paradigm to analyze channel behavior but also helps manufacturers to understand and respond to the phenomenon of distributors’ “banding together” comprehensively and deeply.

Details

Nankai Business Review International, vol. 11 no. 4
Type: Research Article
ISSN: 2040-8749

Keywords

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