Channel Relationships Theory

Statement of the Problem/BackgroundThe rapid development of economic interaction now goes across national and ideological boundaries, so do competitions in all forms. In the market of China, domestic companies such as Legend, Wahaha, and Bird had already gained competitive advantage through distributional channels, while multinational companies, such as Wal-Mart, Carrefour, and Ikea, provide evidence of business success via channel management. Therefore, distribution channel management is now regarded as key of getting business success and competitive advantage by more and more within the market of China. In this context, abundant articles presented in many Chinese business newspaper and journals claim that the only way to control the market is to get the channel advances. Channel advances, however, by now means, are the must to control the market, according to histories of development of many companies both inside and outside of China. Without channel advantages, on the other hand, it is true that one cannot even survive in the marketplace. The relationship of channels verses companies is just like that of boats and people who want to go cross the river. One cannot get to the other side of the river without a boat, while a company cannot go from production to the marketplace. That is the importance of marketing channel.The opinion of this study is that the core of marketing channel is relationship among the channel members. Thus, to manage a market channel is to construct, retain, and develop channel relations. That is the key to the study of channel management theories and practical interpretation. Based on many studies, the author finds that producer channel theory, results in non-continuous and short-term oriented design and control. It is weak to explain and promote the current trend of channel management which is more focus on interactive, multidimensional, long-term oriented and continuous relationships. Therefore, it is clear that there should be a study from a newperspective, with an in-depth exploration focusing on the development of channel relation concept.In this context, it becomes clear why the management of channel relations is essential, not only for the standardization of process and system itself, but also to Chinese domestic firms who look to gain competitive advantages in the market. On the other hand, the existing researches on channel member relationship management are conducted mainly in other countries. This study, however, will provide in-depth insights of member relationship management for both academic and practical aspects.The systematic study of this research is designed to shed light on Critical Questions as following: These questions are: (1) If channel relation exists in ever step of channel management process, (2) If there is any interrelationship among models of the channel, system of management, and channel relations, (3) what the key elements are to construct a new channel management model focusing on the relationship of channel member in a tow-dimensional, and long-term oriented viewThis study collects both primary research and literature reviews to explore the issues of channel relationship management. The review on the literatures of foreign study helps to build the study instruments of this study, while the study on the social science and other related theories adding new ways of research to this study. MethodologyResearch Methods and Technique of this study are stated as following:1. Statement of the Problem: channel management is about bringing sustainable competitive advantages to different firms. The current channel management theory and practice focusing on producer (or one firm) now are unable to archive the goal of management channel relations. It is time calling for building a long-term oriented channel with mutually recognized rules and standards as management guidance and directions to get sustainable competitive advantages to the marketplace. By do so, this study has both practical meanings and academic devotions, since the cu...