Managing cooperative relationships with retailers: A contingency model for manufacturing firms

Manufacturers need to cope with different types of retailers if they want to develop and maintain more effective and efficient relationships. To date, however, manufacturers have not been offered with a contingency model that helps them manage their relationships with retailers. In this study, a solution is proposed to the aforementioned problem that requires a three step process. The first step involves classification of retailers based on strategic orientations like market/customer orientation, cost orientation, sales orientation, and innovation orientation. In the second step, the manufacturers' level of cooperation with the retailers is assessed and the differences between manufacturer classes are identified. Finally in the third step, a portfolio management approach is proposed so that each of the retailers can be classified into a distinctive group where cooperation goals can be set and monitored for success and/or resource (re)allocation. The results of the study are not only meant to provide a contingency model of cooperative manufacturer-retailer relationships, but to help manufacturer practitioners make trade-off decisions regarding their management of retailer relationships.