Channel Development Process of Federal Laws - Assignment Example

Channel Development Process Channel Development Process The first federal law to be enacted in the United s was the Sherman Antitrust Act in the 1890. The act was intended to combat the business trusts of the American economy during the nineteenth century. It is evident that even now the Sherman act is the bedrock of antitrust enforcement in the U.S. The act prohibited two broad types of conduct. One is that it declares every contract in the form of trust to be illegal. The other one is that it prohibits the effort to monopolize any part of commerce among several states. This paper discusses issues of channel development process of federal laws, strategic alliances and the typical conflicts evident. The federal laws are enforced by both public and private parties. As for the public enforcement, the government is involved in the process. This is where the Federal Trade commission (FTC) is responsible in investigating and litigating cases under the Sherman Act. Private enforcement is evident where anyone injured in his business property has the right to go at the courts to seek justice under the federal laws. Federal laws prohibit per se offences. This involves various form of agreements among competitors which tend to be harmful to competition and the customers. The offenses are regarded as per se illegal because they result in customers harm (Zeldin, 2006). Price fixing is one of the offenses under the per se offences. It entails an agreement among competitors to lower, raise and stabilizing of the price range offered for their product or services. It is apparent those competitive terms that competitors don’t agree to include shipping fee and warranties to discounts directly or indirectly affect prices. Price fixing can affect Afterschool Depot channel policies if its competitors undercut the prices in a way that the company cannot be able to cover its costs (Zeldin, 2006). Federal laws also prohibits bid rigging, it involves coordinated conduct that undermines the bidding process. Due to this federal law that prohibits bid rigging Afterschool Depots will be force to set and submit quality bids so as they can get a particular contract. A market allocation is also prohibited by the federal laws. It involves where the businesses are not competing for customers. This will influence the Afterschool Depot’s channel policies as they will embrace the selling of the mobile kitchen product to various customers. This is because the law does not embrace sale territories among companies (Zeldin, 2006). Strategic alliances are critical in any business objective. Cost reduction is one of the proven advantages of forming strategic alliances. This is evident when companies together invest in new standards, processes and technologies and this leads to a substantial cost saving in their internal operations. As for the Afterschool Depot’s the alliance will minimize their operating cost thus profit will be realized as they will have achieved an industrial-leading cost structure. Research has proven that strategic alliances have been successful in many companies. For example Apple has partnered with Sony, Motorola, AT&T and Phillips recently and the results have led to the growth of the company in the technological world. Also, the E-Discovery platform for the Apple iPad has enabled businesses to obtain information in a legal manner. A strategic alliance enables a firm to have a competitive advantage in the market space. This is evident when a business wants to build incremental skills in its operations and thus joins up with an experienced partner. In this case for Afterschool Depot firm to obtain a sustainable competitive advantage it has to join up with an experienced partner and set out some policies to guide the alliance. It is also apparent that the alliance will work best when the objectives are shared and when the cultures of the company are aligned enough to enable various methods to be leveraged. Also the alliance will be effective when the policy structure of the alliance is established to promote learning from the executive level to the operational level (Yoshino & Rangan, 1995). Afterschool Depot should work to develop strategic alliances within their channels. This is because a strategic alliance in an adjacent market can block competitive threats from emerging companies. The alliances enable the companies to strategize better in the future options. The achievement of long-term objective is made possible in terms of the expansion of the distributions in a different market. Afterschool Depot firm will be able to mitigate risk when it joins up in a strategic alliance as the losses are shared (Yoshino & Rangan, 1995). Afterschool Depot’s retail positioning strategy flow from cost-side and demand-side should increase the power of retailers. This is because of the need for price leveling completion by retailers and the consolidation of the retail outlets. The retail positioning should increase marketing pressures to push ip the chain for price breaks and merchandising support. Also technology should be embraced as it enables retailers to target consumer purchases on one on one basis rather than the mass market promotions offered by manufacturers of the product. The retailing position strategy should broaden the role and impact of private branding. This involves the retails brand name, store name and the designer exclusive. The advantage of this is that it allows exclusivity and avoids direct price competition even though it limits manufacture brand building (Paulsen & John, 2001). Afterschool Depot retail positioning strategy also needs to change the role of price promotion within the marketing mix. The channels in the company should refocus by redirecting non-marketing investments towards product development and marketing. The distribution channels should also be expanded to make it easier the access by the customers Channel conflict may be caused by changing of prices across channels between manufacturers and retailers. The conflict brought about by not pricing the same across the firm retailers leads to some people in the chain feeling injured. Also, unequal promotion activities from the manufacturers across the retailers which relate to prices cause the channel conflict. Another cause of conflict is the goal incompatibility. It is evident when the manufacturers direct distribution channel is not clearly defined to its wholesalers and retailers. Another crucial conflict cause is when the manufacturers and retailers have different perceptions of reality. It is apparent when retailers and wholesalers undertake different marketing activities for the same product. Thus, when the goals between manufactures and retailers become more incompatible the greater the level of conflict in the distribution channel (Glynn & Woodside, 2009). Channel conflict can be reduced by manufacturers compensating their sales people for refer of customers and to a retailer who can better meet their needs. The manufacture can reduce the conflict by introducing strong brand identity for its products. This is because when products have a strong brand identity, the manufacturers can choose to fit its assortment to the several distribution channels and thus wholesalers and retailers (Glynn & Woodside, 2009). In conclusion, it is evident that federal laws influence any business to work in a good environment that will lead to quality product and services. Also, strategic alliances help After school Depot to reduce the risk in the business environment and the growth of the company in the future. There are also channel conflicts that can be solved through the setting up of strong brands and better pricing strategies. References Glynn, S. Mark & Woodside, G. Arch. (2009). Business-to-business Brand Management: Theory, Research and Executive Case Study Exercises Volume 15 of Advances in business marketing and purchasing USA: Emerald Group Publishing. Paulsen, B. M & Smart, C. John. (2001). The Finance of Higher Education: Theory, Research, Policy, and Practice. USA: Algora Publishing. Yoshino, Y. Michael & Rangan, U. S. (1995). Strategic Alliances: An Entrepreneurial Approach to Globalization. USA: Harvard Business Press. Zeldin, B. Schacter. (2006). The New Medicines: How Drugs are Created, Approved, Marketed, and Sold. USA: Greenwood Publishing Group. Read More