IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v45y2024i1p469-476.html
   My bibliography  Save this article

Manufacturers' incentive to establish direct‐to‐consumer channels

Author

Listed:
  • Dong Joon Lee
  • Yuji Ono

Abstract

In this paper, we consider a manufacturing duopoly in which each manufacturer initially sells a homogenous product through its dedicated retailer. The main purpose of this paper is to examine whether each manufacturer will endogenously sell its product directly to consumers. Our main results are two. One is that one manufacturer chooses a direct distribution while the other does not. Conventional wisdom suggests that increased market competition is generally presumed to decrease profits. Here, “increased competition” could mean entry of new firms or softening of product differentiation. The other is that the profits of manufacturers are higher under a dual channel than under an indirect channel when the retailing costs of manufacturers are sufficiently small.

Suggested Citation

  • Dong Joon Lee & Yuji Ono, 2024. "Manufacturers' incentive to establish direct‐to‐consumer channels," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 45(1), pages 469-476, January.
  • Handle: RePEc:wly:mgtdec:v:45:y:2024:i:1:p:469-476
    DOI: 10.1002/mde.4017
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/mde.4017
    Download Restriction: no

    File URL: https://libkey.io/10.1002/mde.4017?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:45:y:2024:i:1:p:469-476. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.