Conflict in Distribution Channel

Channel Conflict

Disagreement among marketing channel members on goals and sales who should do what and for what rewards. A distribution channel consists of firms that have banded together and are dependent on each other to achieve a common goal.

Horizontal Conflict

Conflict among firms at the same level of the channel. Dealers may complain about other dealers in the town that steal sales from them by being too aggressive in their pricing and advertising, or by selling outside their assigned territories.

Vertical Conflict

More common and refers to conflicts between different levels of the same channel. In the pharmaceutical industry, concentration of the distribution systems in some countries results in enhanced negotiating power for channel intermediaries, particularly the big wholesalers.