A Study Of Reverse Control By The Retailers In Commodity Supply Chain

In the process of building market economy, the relationship between suppliers and retailers experiences great change that retailers have increased its ability to implement converse controlling. The trend that retailers dominate the supply chain is the invariably outcome. At the same time, this trend was enhanced by the retailers reclaim the control of marketing factors. Depending on this basis, retailers start to implement converse controlling. Although the government has taken amount of measures such as acting the laws and drawing many policies to regulate the market, this contradiction between retailers and suppliers was not alleviated. This essay takes the converse controlling as the analyses object and supposes the phenomenon that retailer dominates the supply chain is the natural result of the transition from planned economy to market economy, which makes this research got fully operation significance and theory significance.This article elucidates and definite the basic meaning of converse controlling and its implementing way and operating mechanism. In addition, the paper measures the market power of suppliers and retailers. Concretely speaking, converse controlling is the retailers influence the suppliers depending on the market power, which involves three basic meanings----it is just a counteraction in nature which has inevitability and negative influence. Combined with Galbraith Hypotheses and competing power, the paper measures the market power of retailers and suppliers. The analyses shows the retailers’premiums is about27%while the suppliers’ is0.94%, which means the retailers boast the comparative market power. The comparative market power abates the suppliers’net profit and its ability to determine the price. What’s more, that reflects the competing power and converse controlling.This paper also uses the modern economic analysis such as game theory which analyses the welfare change because of relative conduction. The empirical result prompts the further research of the Conduct of the converse controlling, especially through games technical explains the welfare changes of the related to act may result in.This article analyses two aspects:the and the marketing of the own brands.On the base of analysis the charge of the channels fee, the article profoundly clarify the reason、the definition and form of the reality exist, then under moral risk model of the hidden action gets the most cost-effective measure of the channels fee. On the base of all the contents, the article divides into three categories to discussed the net benefits:the retailers have the buyer influence power not the seller influence power; the retailers have the buyer influence power and the seller influence power; the bilateral monopoly. From the result of the analysis, three cases of change are not consistent. The article further analyses the effect of the channels fee as a contrast with the reality. On the base of analysis the marketing of the own brands, the article gives the relevant definition of the own brands,and analyze the advantages and strategies of the retailers.Then analysis the influence resulted by the sort of the behavior with Cases of the Watson.In the analysis of the retailers’converse controlling, the problems of the retailers are therefore higher income and the suppliers are damaged inevitable and important problems. The article through analysis the financial statements, concretely analysis the past several years of financial statements of the part sale retail enterprises and suppliers, practice contrasts and analysis from the Profitability、the debt capacity、the Profitability and the liquidity and so on. All the results displays that the profitability of the suppliers weaker than the retailers. Also showed that the supplier have the big difference among themselves.Besides, the article especial analysis the scale economies of the retail businesses, the measurement result also shows the retailer is really use of the scale economic advantages, the mergers and restructuring of the retailers will expand its basis and power to implementation the reverse control.In this paper, in allusion to the reverse control implemented by retailers to suppliers and based on Conclusions and related principles, government regulation measures with the core of Anti-monopoly Law and its related laws have been presented, which will been specified into two measures:constructing orderly competition and promoting relationship marketing. Constructing orderly competition include regulating collection of channels fee, giving close attention to merger and recombination of retail business especially foreign retailers, cultivating the large retail enterprise localization. Promoting relationship marketing include being focus on building long-term stability continuous relations of cooperation, creating multi-win situation, transferring retailers and suppliers game into retailers and suppliers cooperation.