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Factors Affecting the Allocation of Trade Promotions in the U.S. Food Distribution System


  • Miguel I. Gómez
  • Laoura M. Maratou
  • David R. Just


Although many have proposed theories explaining trade promotion (TP) behavior by manufacturers, lack of data has prevented empirical assessment. We employ survey data to explore the effect of manufacturer and retailer bargaining power on the allocation of TPs in the U.S. food sector. The survey respondents consist of retailers controlling 40% of retail sales in U.S. supermarkets. Retailer bargaining power increases the allocation of funds to off-invoice TPs through higher share of private label and retailer size. Manufacturer bargaining power decreases the allocation of funds to off-invoice TPs by establishing formal policies of negotiation. Copyright 2007, Oxford University Press.

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  • Miguel I. Gómez & Laoura M. Maratou & David R. Just, 2007. "Factors Affecting the Allocation of Trade Promotions in the U.S. Food Distribution System," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(1), pages 119-140.
  • Handle: RePEc:oup:revage:v:29:y:2007:i:1:p:119-140

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    Cited by:

    1. Gomez, Miguel I. & Rao, Vithala R. & Yuan, Hong, 2008. "Effects of Horizontal and Vertical Market Power on Trade Promotion Budget and Allocation in the US Supermarket Industry: An Experimental and Empirical Analysis," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6247, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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