SALES AND DISTRIBUTION

MANAGEMENT
CHANNEL CONFLICTS - ASSIGNMENT
Group 007 (Section B)
Arun M(PGP18182) | Deepak Kumar (PGP18187) | Deepraj Balke (PGP18188) LNV
Sai Bhaskar (PGP18040) | Prince Kumar (PGP18063) | Subham Kant (PGP18234)
CONFLICT HANDLING STRATEGIES
HIGH IMPORTANCE | HIGH PROSPECT

Act to avert or address the conflict

Examples

1. Pepsi International in Ukraine

Pepsi exercised complete control over the supply chain operations using its own expatriate supply-chain managers and used only those
distributors that showed signs of commitment and with whom trust could be built. It screened out those distributors who had the potential to
cause harm and who showed fewer signs of commitment to the company.

2. Symantec
Lieberman had a slightly different experience with Symantec, manufacturer of the popular Norton computer safety and Internet security
suite of products. Beginning two months before, NetSciences was alerting its customers that their subscriptions were to expire. Symantec was
sending out more frequent notices, confusing the customers. Symantec had been using a third-party service. The customer could choose to
renew with Symantec or the reseller. Realizing this was a communication snafu, the issue was resolved by having Symantec send the notices
to customers, referring them to the reseller, indicating this is the only channel they can use to renew.
HIGH IMPORTANCE | LOW PROSPECT

Look for opportunities to reassure threatened channel

Examples

1. Cisco
Conflict developed at Cisco way back in 1996, when it wanted to add another level to its direct sales force. This caused resentment among
the existing salespeople, thinking their sales would be hindered because everybody would be sharing the same pie. So, Cisco created
more pies. They created a three-tier sales force, where different products, based on complexity, were sold by salespeople in each tier.
Each salesperson could concentrate on its area and become experts in those products. The result was more products were sold and Cisco
left competitors in the dust.
LOW IMPORTANCE | HIGH PROSPECT

Allow threatened channel to decline

Examples

1. Apple
The quarterly report released by Apple in July, 2007 indicated that its own 185 retail stores had generated $918 million in sales, $185
million in “segment margin.” The number of retail outlets were increasing at a 33% yearly rate and serving 22,000,000 customers. The
problem was this was driving customers toward the Apple stores and away from the establishments that sold Apple products. This caused
channel conflict. Some of those store owners were unhappy. Some channel stores were able to maintain relationships with long-term
customers. While they couldn’t sell the computer hardware from their brick and mortar shops, they were able to sell educational accounts
and maintain relationships with their local schools, providing training and on-site technical support. Apple also sells the iPhone through all
major cell phone carriers, Amazon, Staples, Bestbuy and other big box stores.
LOW IMPORTANCE | LOW PROSPECT

Do nothing

Examples

1. OnePlus in India
The company has been selling exclusively through Amazon online ever since it launched, until it recently started to open its own retail outlets
in major cities. The retail outlets often complain regarding the lack of demand due to special offers on Amazon, however, the company has
chosen to do nothing and let the customers choose how and where they want to make the purchase.
THANK YOU
- GROUP 007 (SEC B)