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Do channel members value supportive retail services? Why?

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  • Pei, Zhi
  • Yan, Ruiliang

Abstract

When a manufacturer opens an online channel to compete with its retailer, how can the channel conflict be resolved and the relationship between channel members be improved? Our research proposes supportive retail services as an effective incentive to coordinate the dual-channel distribution and govern the relationship between channel members. We use a profit-maximization model to show that supportive retail services can be utilized to alleviate dual-channel competition and achieve a Pareto result for all channel members. As product compatibility with the web changes, the manufacturer's financial support for retail services also changes. When the product is more compatible with the web, the manufacturer would like to offer more financial support as an effective incentive to the retailer to improve its retail services. However, the value of supportive retail services always increases for the manufacturer but first increases and then decreases for the retailer as product compatibility with the web increases.

Suggested Citation

  • Pei, Zhi & Yan, Ruiliang, 2015. "Do channel members value supportive retail services? Why?," Journal of Business Research, Elsevier, vol. 68(6), pages 1350-1358.
    • Handle: RePEc:eee:jbrese:v:68:y:2015:i:6:p:1350-1358
    DOI: 10.1016/j.jbusres.2014.12.005
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    References listed on IDEAS

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    Cited by:

    1. Noriaki Matsushima & Tomomichi Mizuno, 2018. "Supplier encroachment and retailer effort," ISER Discussion Paper 1027, Institute of Social and Economic Research, Osaka University.
    2. Pei, Zhi & Wooldridge, Barbara Ross & Swimberghe, Krist R., 2021. "Manufacturer rebate and channel coordination in O2O retailing," Journal of Retailing and Consumer Services, Elsevier, vol. 58(C).
    3. Savastano Marco & Anagnoste Sorin, 2020. "Pioneering Strategies in Retail Settings: An Empirical Study of Successful Practices," Management & Marketing, Sciendo, vol. 15(4), pages 643-663, December.
    4. Qiuxiang Li & Xingli Chen & Yimin Huang & Huangbao Gui & Shengyang Liu, 2019. "The Impacts of Green Innovation Input and Channel Service in a Dual-Channel Value Chain," IJERPH, MDPI, vol. 16(22), pages 1-26, November.
    5. Seyed Jafar Sadjadi & Hashem Asadi & Ramin Sadeghian & Hadi Sahebi, 2018. "Retailer Stackelberg game in a supply chain with pricing and service decisions and simple price discount contract," PLOS ONE, Public Library of Science, vol. 13(4), pages 1-24, April.
    6. Li, Bo & Jiang, Yushan, 2019. "Impacts of returns policy under supplier encroachment with risk-averse retailer," Journal of Retailing and Consumer Services, Elsevier, vol. 47(C), pages 104-115.
    7. Kumar, Anil & Naz, Farheen & Luthra, Sunil & Vashistha, Rajat & Kumar, Vikas & Garza-Reyes, Jose Arturo & Chhabra, Deepak, 2023. "Digging DEEP: Futuristic building blocks of omni-channel healthcare supply chains resiliency using machine learning approach," Journal of Business Research, Elsevier, vol. 162(C).
    8. Yan, Ruiliang & Pei, Zhi, 2019. "Return policies and O2O coordination in the e-tailing age," Journal of Retailing and Consumer Services, Elsevier, vol. 50(C), pages 314-321.
    9. Mirzabeiki, Vahid & Saghiri, Soroosh Sam, 2020. "From ambition to action: How to achieve integration in omni-channel?," Journal of Business Research, Elsevier, vol. 110(C), pages 1-11.
    10. Jumpei Hamamura & Yusuke Zennyo, 2021. "Retailer voluntary investment against a threat of manufacturer encroachment," Marketing Letters, Springer, vol. 32(4), pages 379-395, December.
    11. Cao, Zixia & Yan, Ruiliang, 2021. "Product nutrition, innovation, advertising, and firm’s financial gains," Journal of Business Research, Elsevier, vol. 133(C), pages 13-22.

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