The balance of power in a marketing channel
The nature of a relationship between a manufacturer and retailer, the extent to which it is either harmonious or discordant, largely depends on the power held by each party and the way this power is used. Power relationships also have a direct bearing on the outcomes of negotiations and thus on the economic and financial fortunes of both manufacturers and retailers. This paper examines power in the context of marketing channels. It looks at the importance, the sources, the dimensions and the uses of channel member power. The paper then goes on to suggest a framework which provides for a systematic approach to the analysis of power in marketing channels. Finally the paper turns to the GB grocery trade to demonstrate the importance of understanding power relationships and the value of the suggested framework for so doing.
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