publication . Article . Other literature type . 1999

Manufacturer Allowances and Retailer Pass-Through Rates in a Competitive Environment

Sang Yong Kim; Richard Staelin;
Open Access
  • Published: 01 Feb 1999 Journal: Marketing Science, volume 18, issue 1, pages 59-76
Abstract
A commonly held belief has grocery and mass merchandise retailers gaining power relative to the upstream consumer package goods manufacturers. One of the major justifications for this belief is that manufacturers are now giving retailers more side payments such as trade allowances, slotting allowances, etc. However, a number of researchers have shown that these concessions have not translated into increased profit for the retailer relative to the manufacturer. This paper explores, via an analytic model, why one might see retailers getting concessions from the manufacturer without being able to translate them into high profits. We do this by representing the inte...
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free text keywords: Channel Management, Trade Promotions, Nash Equilibrium, Marketing, Business and International Management, Brand loyalty, Economics, Demand curve, Stackelberg competition, Product (business), Profit (economics), Monopoly, Payment, media_common.quotation_subject, media_common, Product category
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