• Journal of Digital Convergence
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• v.5 no.1
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• pp.47-53
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• 2007

We consider supply chain which consist of one manufacturer, one distributor and N retailers for a single product. This paper determines inventory replenishment period of supply chain using heuristic method and propose order policy through re-coordination of inventory replenishment. Also, We develops inventory management model to calculate total cost of supply chain under assumptions of constant demand. The computational results show that the proposed inventory replenishment period and inventory management model is efficient.

• Journal of Distribution Research
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• v.16 no.3
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• pp.1-32
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• 2011

I. Introduction: In Chinese electronics industry, the local wholesalers are still dominant but power is rapidly swifting from wholesalers to retailers because in recent foreign big retailers and local mass merchandisers are growing fast. During such transient period, conflicts among channel members emerge important issues. For example, when wholesalers who have more power exercise influence strategies to maintain status, conflicts among manufacturer, wholesaler, and retailer will be intensified. Korean electronics companies in China need differentiated channel strategies by dealing with wholesalers and retailers simultaneously to sell more Korean products in competition with foreign firms. For example, Korean electronics firms should utilize 'guanxi' or relational quality to form long-term relationships with whloesalers instead of power and conflict issues. The major purpose of this study is to investigate the impact of conflict, dependency, and influence strategies between local Korean-products-selling retailers and wholesalers on performance in Chinese electronics distribution channels. In particular, this paper proposes effective distribution strategies for Korean electronics companies in China by analyzing moderating effects of 'Guanxi'. II. Literature Review and Hypotheses: The specific purposes of this study are as follows. First, causes of conflicts between local Korean-products-selling retailers and wholesalers are examined from the perspectives of goal incongruence and role ambiguity and then effects of these causes are found out on perceived conflicts of local retailers. Second, the effects of dependency of local retailers upon wholesalers are investigated on local retailers' perceived conflicts. Third, the effects of non-coercive influence strategies such as information exchange and recommendation and coercive strategies such as threats and legalistic pleas exercised by wholesalers are explored on perceived conflicts by local retailers. Fourth, the effects of level of conflicts perceived by local retailers are verified on local retailers' financial performance and satisfaction. Fifth, moderating effects of relational qualities, say, 'quanxi' between wholesalers and retailers are analyzed on the impact of wholesalers' influence strategies on retailers' performances. Finally, moderating effects of relational qualities are examined on the relationship between conflicts and performance. To accomplish above-mentioned research objectives, Figure 1 and the following research hypotheses are proposed and verified. III. Measurement and Data Analysis: To verify the proposed research model and hypotheses, data were collected from 97 retailers who are selling Korean electronic products located around Central and Southern regions in China. Covariance analysis and moderated regression analysis were employed to validate hypotheses. IV. Conclusion: The following results were drawn using structural equation modeling and hierarchical moderated regression. First, goal incongruence perceived by local retailers significantly affected conflict but role ambiguity did not. Second, consistent with conflict spiral theory, the level of conflict decreased when retailers' dependency increased toward wholesalers. Third, noncoercive influence strategies such as information exchange and recommendation implemented by wholesalers had significant effects on retailers' performance such as sales and satisfaction without conflict. On the other hand, coercive influence strategies such as threat and legalistic plea had insignificant effects on performance in spite of increasing the level of conflict. Fourth, 'guanxi', namely, relational quality between local retailers and wholesalers showed unique effects on performance. In case of noncoercive influence strategies, 'guanxi' did not play a role of moderator. Rather, relational quality and noncoercive influence strategies can serve as independent variables to enhance performance. On the other hand, when 'guanxi' was well built due to mutual trust and commitment, relational quality as a moderator can positively function to improve performance even though hostile, coercive influence strategies were implemented. Fifth, 'guanxi' significantly moderated the effects of conflict on performance. Even if conflict arises, local retailers who form solid relational quality can increase performance by dealing with dysfunctional conflict synergistically compared with low 'quanxi' retailers. In conclusion, this study verified the importance of relational quality via 'quanxi' between local retailers and wholesalers in Chinese electronic industry because relational quality could cross out the adverse effects of coercive influence strategies and conflict on performance.

• Journal of Korean Society of Industrial and Systems Engineering
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• v.38 no.4
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• pp.80-87
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• 2015

The proliferation of the Internet and communication technologies and applications, besides the conventional retailers, has led to a new form of distribution channel, namely home sopping through the telephone, TV, catalog or the Internet. The conventional and new distribution channels have different transaction costs perceived by the consumers in the following perspectives: the accessibility to the product information, the traffic cost and the opportunity cost for the time to visit the store, the possibility of 'touch and feel' to test the quality of the product, the delivery time and the concern for the security for the personal information. Difference in the transaction costs between the distribution channels results in the different selling prices even for the same product. Moreover, distribution channels with different selling prices necessarily result in different business surpluses. In this paper, we study the multilateral bargaining strategy of a manufacturer who sells a product through multiple distribution channels with different transaction costs. We first derive the Nash equilibrium solutions for both simultaneous and sequential bargaining games. The numerical analyses for the Nash equilibrium solutions show that the optimal bargaining strategy of the manufacturer heavily depends not only on the degree of competition between the distribution channels but on the difference of the business surpluses of the distribution channels. First, it is shown that there can be four types of locally optimal bargaining strategies if we assume the market powers of the manufacturer over the distribution channels can be different. It is also shown that, among the four local optimal bargaining strategies, simultaneous bargaining with the distribution channels is the most preferred bargaining strategy for the manufacturer.

• Journal of Distribution Research
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• v.17 no.4
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• pp.29-53
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• 2012

As so many marketers get to use diverse sales promotion methods, manufacturer and retailer in a channel often use them too. In this context, diverse issues on sales promotion management arise. One of them is the issue of unplanned buying. Consumers' unplanned buying is clearly better off for the retailer but not for manufacturer. This asymmetric influence of unplanned buying should be dealt with prudently because of its possibility of provocation of channel conflict. However, there have been scarce studies on the sales promotion management strategy considering the unplanned buying and its asymmetric effect on retailer and manufacturer. In this paper, we try to find a better way for a manufacturer in a channel to promote performance through the retailer's sales promotion efforts when there is potential of unplanned buying effect. We investigate via game-theoretic modeling what is the optimal cost sharing level between the manufacturer and retailer when there is unplanned buying effect. We investigated following issues about the topic as follows: (1) What structure of cost sharing mechanism should the manufacturer and retailer in a channel choose when unplanned buying effect is strong (or weak)? (2) How much payoff could the manufacturer and retailer in a channel get when unplanned buying effect is strong (or weak)? We focus on the impact of unplanned buying effect on the optimal cost sharing mechanism for sales promotions between a manufacturer and a retailer in a same channel. So we consider two players in the game, a manufacturer and a retailer who are interacting in a same distribution channel. The model is of complete information game type. In the model, the manufacturer is the Stackelberg leader and the retailer is the follower. Variables in the model are as following table. Manufacturer's objective function in the basic game is as follows: ${\Pi}={\Pi}_1+{\Pi}_2$, where, ${\Pi}_1=w_1(1+L-p_1)-{\psi}^2$, ${\Pi}_2=w_2(1-{\epsilon}L-p_2)$. And retailer's is as follows: ${\pi}={\pi}_1+{\pi}_2$, where, ${\pi}_1=(p_1-w_1)(1+L-p_1)-L(L-{\psi})+p_u(b+L-p_u)$, ${\pi}_2=(p_2-w_2)(1-{\epsilon}L-p_2)$. The model is of four stages in two periods. Stages of the game are as follows. (Stage 1) Manufacturer sets wholesale price of the first period($w_1$) and cost sharing level of channel sales promotion(${\Psi}$). (Stage 2) Retailer sets retail price of the focal brand($p_1$), the unplanned buying item($p_u$), and sales promotion level(L). (Stage 3) Manufacturer sets wholesale price of the second period($w_2$). (Stage 4) Retailer sets retail price of the second period($p_2$). Since the model is a kind of dynamic games, we try to find a subgame perfect equilibrium to derive some theoretical and managerial implications. In order to obtain the subgame perfect equilibrium, we use the backward induction method. In using backward induction approach, we solve the problems backward from stage 4 to stage 1. By completely knowing follower's optimal reaction to the leader's potential actions, we can fold the game tree backward. Equilibrium of each variable in the basic game is as following table. We conducted more analysis of additional game about diverse cost level of manufacturer. Manufacturer's objective function in the additional game is same with that of the basic game as follows: ${\Pi}={\Pi}_1+{\Pi}_2$, where, ${\Pi}_1=w_1(1+L-p_1)-{\psi}^2$, ${\Pi}_2=w_2(1-{\epsilon}L-p_2)$. But retailer's objective function is different from that of the basic game as follows: ${\pi}={\pi}_1+{\pi}_2$, where, ${\pi}_1=(p_1-w_1)(1+L-p_1)-L(L-{\psi})+(p_u-c)(b+L-p_u)$, ${\pi}_2=(p_2-w_2)(1-{\epsilon}L-p_2)$. Equilibrium of each variable in this additional game is as following table. Major findings of the current study are as follows: (1) As the unplanned buying effect gets stronger, manufacturer and retailer had better increase the cost for sales promotion. (2) As the unplanned buying effect gets stronger, manufacturer had better decrease the cost sharing portion of total cost for sales promotion. (3) Manufacturer's profit is increasing function of the unplanned buying effect. (4) All results of (1),(2),(3) are alleviated by the increase of retailer's procurement cost to acquire unplanned buying items. The authors discuss the implications of those results for the marketers in manufacturers or retailers. The current study firstly suggests some managerial implications for the manufacturer how to share the sales promotion cost with the retailer in a channel to the high or low level of the consumers' unplanned buying potential.

• Proceedings of the Korea Society of Information Technology Applications Conference
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• 2007.05a
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• pp.198-208
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• 2007

Recently business enterprises have forced to face in fierce competition in today's global markets due to the short life cycles of products and the higher expectation of customers. Together with continuing advances in communications and transportation technologies, these environments have motivated the continuous evolution of the supply chain and the management techniques. This paper consider three-echelon inventory system which consist of one manufacturer, one distributor and N retailers for a single product under assumption of constant demand. This paper propose the inventory replenishment period using heuristic method and order policy through coordination of inventory replenishment period. The simulation results show that decrease the total cost of the three-echelon inventory system.

• Journal of Korean Institute of Industrial Engineers
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• v.32 no.2
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• pp.91-97
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• 2006

The vehicle routing problem with time windows (VRPTW) is an important problem in third party logistics and supply chain management. We extend the VRPTW to the VRPTW with overtime and outsourcing vehicles (VRPTWOV) which allows the overtime of drivers and the possibility of using outsourcing vehicles. This problem can be applied to third party logistics companies for managing central distributor-local distributors, local distributor-retailers (or customers), and a manufacturer. We develop a mixed integer programming model and a genetic algorithm. Computational results demonstrate the efficiency of the developed genetic algorithm. We also develop a decision support system based on this genetic algorithm.

• Management & Information Systems Review
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• v.29 no.3
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• pp.23-50
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• 2010

This study is that the manufacturer's sales policy power appeared on the source of local distributors through the sale willingness impact on research for coexistence between the manufacturer and dealer sales for developing policy. Dealers in terms of the sale of regional sales willingness says "manufacturers and retailers to connect to the regional distribution on the path to regional sales representative for manufacturers based on trust companies that supply products or products manufactured by local retailers for about a unilateral will sale whether the continued willingness and indicates the degree of business". This study topics are the results of this measure will sell a total of 24 entries are four factors. In variety sales policy of each power source, First, sales policy in Reward Power, compensatory power as the manager of promotion support, sales support and sales activities will significantly impact respectively. Second, sales policy of Coercive Power, reduction of credit limits act as an element of discontent and the sales will appear in the negative hypothesis of the influence was partially supported. Third, sales policy in Referent Power, the information trust, the most significantly impact of trade policy, respectively. Fourth, sales policy in Professional Power, delay time delivery of goods, sales of our product and sales knowledge will have a significantly effect appear to be related.

• Journal of the Korean Operations Research and Management Science Society
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• v.36 no.3
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• pp.107-120
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• 2011

The increased availability of store brand suppliers now provides retailers with opportunities to create their own lines of vertically differentiated multiple store brands within a product category. As the number of store brands increase, the retailer's shelf space becomes more crowded, which may force the retailer to consider dropping some national brands from its assortment. Despite these trends, the problem of product line design in a vertically differentiated product category has been analyzed mainly from a manufacturer's perspective in the marketing literature and it is not known to what extent the findings of the existing product line design literature provide applicable strategic guidelines for the new problem faced by retailers. In this study, we address this deficiency in the literature and conduct an in-depth study of the retailer's strategic design of a line of store brands and its assortment decision within the context of retail category management. We analyze the retailer's decision about not only how to design a line of store brands but also which national brand to drop from its assortment. The results of our analysis are as follows. First, if the retailer has to drop one of national brands from its assortment, it is the best for the retailer to drop the low-quality national brand rather than the high-quality national brand. Second, the retailer has to position the high-quality store brand relatively close to the high-quality national brand, remained on its shelf, in terms of quality so as to maximize the size of retail margin from the national brand. On the other hand, the retailer should set the quality of the low-quality store brand at a lower level than that of the low-quality national brand to increase the total category demand by attracting more price sensitive consumers. By doing so, the retailer can also minimize cannibalization between two store brands. Lastly, our analysis shows that the introduction of a line of store brands improves consumer welfare by increasing real values of all products on the shelf.

• International Area Studies Review
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• v.12 no.3
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• pp.89-109
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• 2008

Using hybrid channel affords the benefits of achieving control through the direct channel and achieving flexibility through the indirect channel. However, using a hybrid channel also poses special challenges to a manufacturer, including the problem of managing multiple channel members with disparate goals and priorities. The purpose of this study is to enhance our understanding on the management of hybrid channel. We study marketing channels for fashion apparel to examine governance challenges and solutions of a hybrid channel. We have two objectives to fulfill that purpose. First, we aim to tie two largely separate research streams of salesforce management and marketing channel management together by examining both intrafrim governance and interfirm governance issues under one conceptual framework. Second, we aim to lay a ground work for rigorous further research on this topic by tying two major theoretical approaches of governance together under one conceptual framework. Our predictions were tested with data from the survey of apparel manufacturers and retailers. The analysis results support the predictions moderately.

• Journal of the Korean Society of Food Culture
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• v.38 no.3
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• pp.129-142
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• 2023

As the demand for ready-to-eat foods continues to grow, concerns about the sodium in processed foods are also growing. In this study, a survey was conducted on the perception of low-sodium products and diffusion plans according to the type of employee (manufacturer, retailer, distributor). Of the 191 responses collected, 189 valid responses (98.9%) were analyzed. The results showed that the employees were aware of the health contribution of a low-sodium diet, labeling for low-sodium, and the promotion of low-sodium food to increase its consumption. Furthermore, retailers recognized the positive contribution of low-sodium products in terms of Environmental, Social, and Governance (ESG) management. The use of sodium substitutes was preferred as the best way to reduce sodium in ready-to-eat foods. With regard to sodium reduction in ready-to-eat foods, we found that the technical factors involved were clustered by the type of business. Specifically, distributors showed a similar performance but had a lower perception of importance than retailers. Manufacturers had a lower perception of both importance and performance. In this study, we collected perceptions from employees who were working at food companies, which differed from previous research. We sought to examine the differences in the perception of sodium reduction and consumption of ready-to-eat foods across various types of employment. Furthermore, we provided specific approaches to reduce perception gaps and enhance understanding among employees.