The Economic Analysis On Alternation Of Marketing Channel For Household Appliances In China

With the development of china's household appliance industry, the marketing channel has been changed. At present, two major marketing channels are household appliance chains and the self-constructing marketing channel. In terms of household appliances chains, the professional marketing channel is that multiple manufacturers authorize one distributor simultaneously to sell their products. Actually, it is a common agency mode. The advantage of this mode is that it can realize the economic law of decreasing the unit cost and increasing the profits. Combining specialization and chain together, the household appliance chain forms an intensive scale of operation, thus to attain such competitive dominances as lower price, completion of variety, and perfection of the service system. Meanwhile, many household appliance manufacturers headed by Gree regard self-constructing marketing channel as a major selling method. Self-constructing marketing channel of the enterprises is such a multiple level single authorizing agency mode that the manufacturer authorizes a general distributor to sell products and the general distributor authorizes all levels of the distributors. Due to this mode, the sales value of the Gree, especially through the self-constructing marketing channel, makes up half of its total sales value. Consequently, it appears from the present that China's household appliance industry is undergoing a transition of two different modes, and the long term interlacing of the two modes will be sure to lead to various complicate conflicts between the marketing channels.Making use of the method of principal-agent theory, this paper analyzes the advantages and disadvantages of the above two modes and the reason of their conflicts. The model illustrates that how the household appliance chains, under the mode of common agency, implement their optimal excitation mechanism and the sales price from the angle of their expecting maximum benefits. It compares and analyzes household appliance monopoly through the channel of self-constructing marketing and the efficiency of the household appliance chains under the mode of common agency. Because of the influence of other principals,the price of the manufacturers and the excitation mechanism, household appliance chains owning multiple principals will be certain to dominate in their price and marketing. At the same time, it probes into the profit sources of the manufacturers under this mode of household appliance chains and the merits and demerits of this marketing mode. The method of commission agency is also used to analyze the price implementing and profit sources of the monopoly stores under the mode of Gree, and to explain the causes of the conflicts of self-constructing marketing channels of household appliance chains and the enterprises and their mode of earning profits. From the analysis of the model, the configuration of counter balance and competitive development of the two marketing channels will exist for a very long time in the future, and the competition of them will continue. Besides, this paper, through the comparison of the development and change of the marketing channels home and abroad, offers relevant suggestions on the development of China's household appliance industry marketing channels, and proposes, under the present circumstances, how to establish a newly co-operative relationship between manufacturers and dealers. However, substantially speaking, the development of the marketing channel is one aspect of the entire household appliance industry. In order to realize the development of the whole household appliance industry, we should make every effort to foster it undergo a prosperous, and rational developing way from the perspectives of technique, management, manufacturing and marketing.