Implication of the gray market in distribution channel management

Lei XU, Qingxia WU, Chi ZHOU*, Xiaoran SHI, Hui WANG

*Corresponding author for this work

Research output: Book Chapters | Papers in Conference ProceedingsConference paper (refereed)Researchpeer-review

Abstract

Gray market has been widely regarded as potential erosion to authorized channel members to sell the authentic products. To mitigate its eroding effect, existing literatures of this institutional practice has heavily worked on the distribution channel management. However, very limited studies dig into the essential origin to dispel the risk of gray market. This paper investigates how and when the gray market derives in a two independent retailing channel extant, and analyzes the production and market factors which the gray market depends on. Meanwhile, we investigate the impact of gray market on the incumbent retailer and the entry retailer. A key finding is that the retailer in the high-level market can weaken the effect of gray market on its retailing channel.

Original languageEnglish
Title of host publicationProceedings of 2016 13th International Conference on Service Systems and Service Management, ICSSSM 2016
EditorsJian CHEN, Xiaoqiang CAI, Changchun ZHOU, Kaida QIN, Baojian YANG
PublisherIEEE
Number of pages6
ISBN (Electronic)9781509028429
ISBN (Print)9781509028436
DOIs
Publication statusPublished - 9 Aug 2016
Externally publishedYes
Event13th International Conference on Service Systems and Service Management, ICSSSM 2016 - Kunming, China
Duration: 24 Jun 201626 Jun 2016

Conference

Conference13th International Conference on Service Systems and Service Management, ICSSSM 2016
Country/TerritoryChina
CityKunming
Period24/06/1626/06/16

Bibliographical note

The authors sincerely thank the editor and the anonymous reviewers for their constructive and important comments on the pa- per. Lei Xu's research is partially supported by National Natural Science Foundation of China, grant no. 71302005, Humanities and Social Sciences Foundation of Ministry of Education in China, grant no. 14YJC630049, and Scientific Development Strategy Project of Tianjin, grant no. 13ZLZLZF03500.

Keywords

  • channel management
  • gray market
  • supply chain management

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