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Transaction types of large retailers and policy directions

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  • Lee, Jinkook

Abstract

In their transaction with retailers, suppliers tend to earn less as the share of purchases under special contract grows. This is due not only to the high sales fees (commission) and frequent unfair practices but also, more fundamentally, to the blatant imbalance in bargaining power. When investigating into unfair trade practices in the retail sector, the government should pay closer attention to how such violations are tied to the type of transaction. It should also work to enhance the negotiation power of suppliers by, for example, diversifying retail channels and strengthening suppliers' rights to adjust payments. Indeed, ensuring equal bargaining power can contribute to expanding direct purchases and fairness in retail transactions.

Suggested Citation

  • Lee, Jinkook, 2021. "Transaction types of large retailers and policy directions," KDI Focus 105, Korea Development Institute (KDI).
    • Handle: RePEc:zbw:kdifoc:105
    DOI: 10.22740/kdi.focus.e.2021.105
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