Type of conflicts:- In any channel arrangement there can be three types of conflicts:

 

(i)Vertical Level Conflict   (ii) Horizontal Level Conflict

(iii)   Multi channel  Level   Conflict

 

 

Vertical level conflict: vertical level conflict occurs when the channel members at one level is in conflict with the channel members at the next higher or lower level.

 

Horizontal level conflict: conflict at the same level between channel members is called horizontal level conflict. Inter stockist conflict or conflict at the retail level among retailers on issues like pricing and territory jumping are examples of horizontal level conflict.

 

Multichannel level conflict: sometimes the middleman come in conflict with the manufacturer using both direct and indirect means of distribution. For example, the firm may have its own franchise outlet or its own shop in area, where it may also be distributing the product through established middleman.

 

 

 

 

 

Distribution  channel management :- distribution channel management encompasses all activities dealing with the distribution function of a firm. The distribution management function can be divided into two phases.

 

1-      the ex ante phase

2-      The ex- post phase

 

 

 

 

Creating and managing a dealer network:

 

Dealer selection:   Dealer selection is the first task in the process of dealer management. It is obvious that a firm has to be very careful in selecting its dealers.

 

Factors to be considered for selecting dealer:- Dougles M. Lambert has suggested some criteria for selecting intermediaries, which are as follows:

 

1-      size of the prospective channel member: the big size of the distributor in terms of sales volume or financial strength or both ensures that there will be no problem regarding the maintenance of adequate stock.

2-      Sales strength : sales strength is measured in terms of number of salesman, number of selling vehicles sales and technical competence. Many times companies prefer distributor of sales strength.

3-      Product lines: while selecting a distributors a company ensures that the distributor is not dealing in competitive products because in such a case promoting the products to retailer will be difficult.

4-      Reputation: a company will prefer the distributors with good reputation.

5-      Market coverage: market coverage is the part of market which a particular distributor covers.

 

 

Characteristics of distribution channels:

v  Route: channel of distribution is a route or pathway through which goods and services flow from the manufactures to consumers.

v  Flow: The flow of goods and services is smooth and sequential and usually unidirectional.

v  Composition: It is composed of intermediaries, such as wholesalers, retailers, agents, distributors etc. Also called middleman.