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Forms of Competition and Outcomes in Dual Distribution Channels: The Distributor’s Perspective

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  • Alberto Sa Vinhas

    (Carson College of Business, Washington State University, Vancouver, Washington 98686)

  • Jan B. Heide

    (Wisconsin School of Business, University of Wisconsin–Madison, Madison, Wisconsin 53706)

Abstract

The focus of this paper is dual distribution channels in business-to-business markets. We take the perspective of the distributor, and examine how different forms of competition with a manufacturer-owned channel impact distributor opportunism. Next, we consider how the same forms of competition impact the distributor’s end customers. Based on a multi-industry field study of industrial distributors, we highlight the complex processes that characterize dual distribution systems. We show that while competition with a manufacturer-owned channel increases distributor opportunism, it also has the potential to benefit the distributor’s end customers. In addition, although actions taken by a manufacturer to create vertical separation between channels limit competition, such actions also reduce end customer satisfaction.

Suggested Citation

  • Alberto Sa Vinhas & Jan B. Heide, 2015. "Forms of Competition and Outcomes in Dual Distribution Channels: The Distributor’s Perspective," Marketing Science, INFORMS, vol. 34(1), pages 160-175, January.
    • Handle: RePEc:inm:ormksc:v:34:y:2015:i:1:p:160-175
    DOI: 10.1287/mksc.2014.0880
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    5. Zhang, Guangming & Dai, Gengxin & Sun, Hao & Zhang, Guitao & Yang, Zhilin, 2020. "Equilibrium in supply chain network with competition and service level between channels considering consumers' channel preferences," Journal of Retailing and Consumer Services, Elsevier, vol. 57(C).

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