The Study Of COG’s Channel Management And Its Optimization Strategy In China

Since the reform and opening up, China’s pharmaceutical industry has maintained rapid growth rate. Up to now, Chinese government has listed biological pharmacy as the high-tech cornerstone industry and the key sector in its economic progress. With the growth of bio-pharmaceutical, laboratory consumable as the main tools using in drug research, production of vaccines, gene and cell engineering attracts more and more enterprises into this industry. COG, as a multinational lab consumable manufacturer, tries to gain its sales increase in China market by adding more channels. But COG’s sales revenue does not catch up with the industry growth rate accordingly. One of the crux lies in its laggard channel management, which brings the contradiction between channel members and distributors’dissatisfaction. When conflict evolves to a certain extent, it will have detrimental effect on end-user and leave competitors opportunity to seize market. This has become the current most urgent to-be-solved problem and also relates to COG’s healthy and solid development in China market.With regard to channel management theory, many scholars have confirmed channel’s role and function played in fierce market competition. They point out high level channel conflict will reduce distribution efficiency and even disintegrate the whole channel. Building partnership and strategic alliance is the effective way to add value in the channel value chain. This paper’s main research object is COG’s distribution channel. Through case study, this paper uses channel conflict and power theory to analyze the existing problems in COG’s channel management. By optimizing channel structure, managing channel conflict and strengthening channel relationship, COG’s channel efficiency will be greatly improved...