channel conflict
Louis W. Stern and Adel I. El-Ansary defined channel conflict as "... a situation in which one channel member perceives another channel member(s) to be engaged in behavior that is preventing or impending him from achieving his goals." Three types of conflict are common in distribution channels: (1) Horizontal conflict occurs between two marketing institutions at the same level in the channel. (2) Intertype conflict results from the use of different types of distribution outlets in the same market area. (3) Vertical conflict is among members of the same channel of distribution. The four strategic alternatives available for resolving the conflict between channel members are: bargaining, boundary, interpenetration, and superorganizational strategies. Under the bargaining strategy one member of the channel takes the lead in activating the bargaining process by being willing to concede something, with the expectation that the other party will reciprocate by adopting flexibility. The bargaining strategy will work out only if both parties are willing to adopt the attitude of give-and-take and if the bottomline results for both are favorable enough to induce them to accept the terms of the bargain. The boundary strategy handles the conflict through diplomacy, i.e., by nominating the employee most familiar with the perspectives of the other party to take up the matter with his or her counterpart there. In order for this strategy to succeed, it is necessary that the diplomat is fully briefed on the situation and is provided leverages with which to negotiate. The interpenetration strategy is directed toward resolving conflict through frequent informal interactions with the other party which lead to a proper appreciation of each other's perspectives. One of the easiest ways to develop interaction is for one party to invite the other to join its trade association. The focus of superorganizational strategy is to employ conciliation, mediation, andarbitration to resolve the conflict. Essentially, a neutral third party is brought into the conflict to resolve the matter. Conciliation is an informal attempt by the third party to bring the two conflicting organizations together and make them come to an agreement amicably. Under mediation, the third party plays a more active role. If the parties in conflict fail to come to an agreement, they may be willing to consider the procedural or substantive recommendations of the mediator. Arbitration may also be applied to resolve channel conflict. Arbitration may be compulsory or voluntary. Under compulsory arbitration, the dispute must by law be submitted to a third party, the decision being final and binding on both the conflicting parties. Voluntary arbitration is a process whereby the parties in conflict submit their disputes for resolution to a third party on their own. Of all the methods of resolving conflict, arbitration is the fastest. Additionally, under arbitration, secrecy is preserved and less expense is incurred. Inasmuch as industry experts serve as arbitrators, one can expect a fairer decision