RIJKSUNIVERSITEIT GRONINGEN June 23, 2014
Author: W.E.C. Valkenburg Supervisor: Prof. dr. L.M. Sloot
Exploring the antecedents for
exclusive cooperation between
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Abstract
The purpose of this study is to explore the antecedents for exclusive cooperation between A-brand manufacturers and retailers. A qualitative research was used in the form of in-depth interviews with A-brand manufacturers and retailers active in the Dutch food sector to explore factors which influence the willingness of manufacturers to offer cooperative differentiation to retailers. The explored antecedents were clustered into six major themes: economic
environment, manufacturer characteristics, retailer
characteristics, retailer and manufacturer relationship characteristics, product category characteristics and cooperative differentiation characteristics.
The end result is a conceptual model which includes all the antecedents influencing the willingness of manufacturers to offer cooperative differentiation. This model can be used in the future to test hypotheses on this topic.
Author: W.E.C. Valkenburg Chassetraat 115-2 1057 JC Amsterdam wecvalkenburg@gmail.com +31(6)18649655 Student number: 1706675 University of Groningen Faculty of Economics and Business MSc Marketing Management Master thesis Date: 23/06/2014 1st Supervisor Prof .dr. L.M. Sloot 2nd Supervisor MSc. C. Donato Research theme Exclusivity, exploring
antecedents for cooperative differentiation in Dutch food sector, willingness of
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Table of content
Abstract ... 1
1. Introduction ... 4
1.1 Problem statement and main question ... 5
1.2 Research methodology ... 6
1.3 Structure of the thesis ... 6
2. Literature research ... 7
2.1 Dutch food sector ... 7
2.1.1 Market situation Dutch food retailers ... 7
2.1.2 Dutch food industry (manufacturers) ... 8
2.2 A-brands and private labels... 9
2.3 Assortments ... 10
2.3.1 Assortments effects ... 10
2.3.2 Assortment exclusivity ... 11
2.4 Power balance between manufacturer and retailers ... 11
2.4.1 Relationship retailer and manufacturer ... 11
2.4.2 Category management and other ... 12
2.5 Exclusive collaborative differentiation ... 12
2.5.1 Advantages and disadvantages of manufacturers in a CD ... 13
2.5.2 Advantages and disadvantages of retailers in a CD ... 14
2.6 Different types of exclusivity ... 15
2.7 Factors influencing the decision to start/not start CD ... 15
3. Research design and methodology ... 16
3.1 Method of research ... 16
3.1.1 Type of research ... 16
3.1.2 Method of qualitative research ... 17
3.1.3 Interview guide ... 17
3.1.3 Participants in the study ... 18
3.2 Data collection ... 19
3.2.1 Sample selection ... 19
3.2.2 Anonymity and confidentiality ... 21
3.3 Analysis... 21
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4.1 Data analysis ... 22
4.1.1 Transcription and coding ... 22
4.1.2 Search for themes ... 23
4.2 Review and define themes ... 25
4.2.1 (Economic) environment ... 25
4.2.2 Manufacturer characteristics ... 27
4.2.3 Retailer characteristics ... 28
4.2.4 Manufacturer/retailer relationship characteristics ... 30
4.2.5 Product category characteristics ... 31
4.2.6 CD characteristics ... 33
4.3 Conceptual model and discussion ... 36
5. Conclusion ... 38
6. Limitations ... 39
7. Managerial implications ... 40
8. Suggestions for future research ... 42
9. References ... 44 9.1 Articles ... 44 9.2 Books ... 46 9.3 Reports ... 47 9.4 Websites ... 47 10. Appendix ... 48
10.1 Appendix 1- Interview guides ... 48
10.1.1 Original interview guide ... 48
10.1.2 Last interview guide ... 50
10.2 Appendix 2 - email to participants ... 53
4 € 0.00 € 0.20 € 0.40 € 0.60 € 0.80 € 1.00 € 1.20 € 1.40 € 1.60 € 1.80 Albert Heijn Jumbo C1000 Plus Coca Cola 1.5L Bolletje beschuit, 135 gram
Pickwick thee Early Grey 20x4gr
Figure 1 – Price comparison A-brands among Dutch retailers
1. Introduction
Retailers can create their own brand equity through the products and brands they stock and sell in order to differentiate from other retailers (Keller, 2009). According to Glynn et al. (2012) brands of manufacturers can help retailers in obtaining their own brand equity. Another benefit of those brands to the retailer is meeting the expectations of their customers. But manufacturers of A-brands want a broad distribution of their A-brands to increase volume and sales (Frazier & Lassar, 1996) so a lot of retailers offer the same products. This makes it for consumers hard to recognize brand equities of the different retailers.
Some retailers try do differentiate on price for those A-brand products which can lead to price erosion at retailers and sometimes even result in price wars. In the Dutch food sector this is what happened over the last decade. Dutch retailers now often offer the same products and A-brands at the same price (figure 1). The Dutch retail market has
become more concentrated and more
transparent for the customers, which makes it
even harder to stand out from competitors. The need to create competitive advantages and differentiate among the other retailers is there more than ever.
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merchandising arrangements have been an interesting development in the marketplace with mass retailers (Lang & Hunt, 2014).
Examples are retailers asking for exclusive products, promotions or offers from manufacturers in their store. This would attract more customers to their stores and differentiate them because they are the only one with that particular product, promotion or offer. In the Netherlands there are several examples of manufacturers and retailers offering this new kind of differentiation; Heineken sells the product Brand Zwaar Blond beer exclusively at retailer Jumbo, Unilever delivers Blue Band bread exclusively to Albert Heijn and Vrumona’s Sisi Fruitbommetje is only in the assortment of C1000. In the Dutch retail sector cooperative differentiation (CD) is emerging (Krabben, 2013).
Due to the consolidation process retailers get bigger and so gain more power in the supply chain (Corstjens et al., 2008). Because of that they have a stronger position against the manufacturers. Retailers try to use this strong position in asking CD with manufacturers in order to differentiate. But there are some benefits for the manufacturers as well to offer exclusivities at one retailer. Krabben (2013) shows that CD for as well the manufacturers as the retailers is an interesting topic which can benefit both. The market share of private labels in the Dutch food sector has grown to 27.2 per cent in 2013 (distrifood.nl, 2014). Due to this growing market share of private labels manufacturers of A-brands need to find ways to retain their shares and retrieve the lost shares. CD can be an instrument to do so.
1.1 Problem statement and main question
Recent research has shown that CD is emerging due to the need of differentiation for retailers. However little research has been done on this topic so there is a need to understand the underlying reasons of CD and which factors influence the decision of starting a CD. Some reasons are known which can effect this decision but no studies have explored all of these antecedents. What factors make manufacturers offer CD to a retailer? Do different product categories influence these factors? And what is the role of the retailer? The unfamiliarity and uncertainty of these antecedents leads to the following explorative research question:
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To get a better understanding in this topic and answer the research question the following sub questions are formulated:
How is the Dutch food market evolving?
How are assortments involved?
What is the power balance between retailers and manufacturers?
What types of collaborations are already there?
What can be advantages and disadvantages for both manufacturers and retailers in a CD?
Which factors that influence the decision for manufacturers and retailers to start/not start with CD are already known?
Which types of CD are known and what are the differences?
Are there differences in outcomes on different product groups?
The goal of the thesis is to create a better understanding in what antecedents can influence the decision for manufacturers to offer CD to a retailer. The main contribution of this thesis will be the development of a conceptual model in which all the explored antecedents in starting a CD for manufacturers are included.
1.2 Research methodology
This section describes the methodology of the research. A comprehensive literature research is conducted before a qualitative research has been performed in the form of in-depth interviews. Due to the explorative nature of the research question qualitative research was used to get a better understanding of which factors influence the decision for manufacturers to start a CD with retailers. 8 manufacturers and 4 retailers were interviewed to reach the goal of investigating all the possible antecedents for a CD. The last step is to analyze the required data and come up with a conceptual model including those antecedents which can be used in the future to test.
1.3 Structure of the thesis
7 0% 5% 10% 15% 20% 25% 30% 35% Market share
2.
Literature research
2.1 Dutch food sector
The Netherlands locates around 4300 supermarkets offering food-products (CBL, 2013). In 2013 there was a turnover of 33.3 milliard euro in the Dutch food sector (Dow Jones, 2013). In this chapter the market situation of the Dutch food retailers and the food industry will be discussed.
2.1.1 Market situation Dutch food retailers
As stated in the introduction the Dutch market has become more centralized which has led to price erosion on the A-market products. The centricity of the market has evolved due to different kind of acquisitions. Most acquisitions are made by bigger supermarket chains that take over smaller chains and turn those stores into their own. A recent example is the Jumbo Group Holding taking over Super de Boer in 2009. Since July 2012 all the stores of Super de Boer are transformed into Jumbo supermarkets (Jumbosupermarkten.nl, 2012). So small supermarket chains lose power where the already
large supermarket chains keep on growing. To gain strength small supermarket chains bundle their forces, like DekaMarkt and Dirk van de Broek did in 2008 (detailresult.nl, 2008). They merged the two chains into one group, the Detailresult group. All these acquisitions and mergers have led to less retailers and more market share per retailer. In figure 2 you can see the centricity in the market share of the retailers in
the Netherlands. The market has become an oligopoly, which means there are a small number of sellers. This gives the retailers more power towards the consumer but also towards the suppliers. The competitiveness between all these strong retailers to keep and gain more market share has become larger. The price schemes for the retailers are comparable due to the price wars there have been in the last decade. According to Sloot (2011) the gap with price fighters is 5 to 6
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percent. As a consequence consumers have lower switching costs which lead to buyer mobility and the transparency of the market has increased (Krabben, 2013). Supermarkets use different strategies in order to differentiate and stay competitive. Jumbo for example uses everyday low pricing to differentiate and Albert Heijn and C1000 use lay use price promotions in order to attract customers. Price promotions are associated with store switching, but Keller (2009) states that this also effects the category purchase decisions of the consumers while they are in the store. Next to distance and convenience, price assortment is one of the most important instruments in a retailer’s strategy to stand out (Lang & Hunt, 2014). They need to differentiate in other ways to attract customers and assortment is a possible instrument to do so.
2.1.2 Dutch food industry (manufacturers)
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Dutch food indsutry as well, for example the merger between the two Dutch dairy giants Campina and Friesland foods to FrieslandCampina in 2008. So not only the Dutch retail market is consolidating, also the Dutch food industry. The top 10 companies account for 34.4% of all the food and drink market (figure 3).
Global trends arise in the Netherlands but there are opportunities for local brands as well. The need for collaboration between the retailer and manufacturer is there more than ever because of the downward price and margins (Bluemind, 2010). Another big threat for the manufacturers of A-brands is the upcoming popularity of private labels.
2.2 A-brands and private labels
Private labels have evolved worldwide from being cheap substitutes for manufacturers A-brands to strong contenders over the years (Senthilvelkumar & Jawahar, 2013). Also in the Netherlands private labels are becoming more and more strong competitors for manufacturers of A-brand products. Research shows that private labels had a turnover of 27.2% in 2013 in the Dutch food industry (Sloot et al., 2014). The Dutch independent website for retailers Distrifood (2013) discusses that the traditional retailers are using the private labels to keep the price-sensitive customers in their supermarket. The traditional retailers are losing customers to price discounters
Table 3 – Consolidation food & drink manufacturers (FFT, 2013)
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as Lidl and Aldi who hardly offer A-brands and are using these private label products to fight those. Also retailers are improving the “look and feel” of the premium private labels which become more brands themselves. All of this has led to losses for the manufacturers.
Manufacturers are being creative in trying to keep their market shares. Branded food manufacturers use the excess of their production capacities to produce the private label brands of the retailers (Berges & Bouamra-Mechemache, 2012). Steenkamp et al. (2010) name other ways for manufacturers to fight the upcoming private label: increase price, focus on major new innovations and advertising.
Another way to fight the upcoming popularity of private labels at retailers for the manufacturers is selective distribution (Landbouwconomischbericht.nl, 2012). This means offering exclusive a-brands products in the assortment of specific retailers. In this way it is possible to receive higher margins and for the retailer to differentiate amongst competitors.
2.3 Assortments
Retailers face the challenge of having an assortment strategy that balances assortments large enough to attract and satisfy consumers while being efficient and profitable (Lang & Hunt, 2014). So retailers know that assortment is an important instrument in attracting customers to their store. Assortments can play an important role for retailers in differentiating from other retailers as well (Simonson, 1999). Chernev (2011) claims that the consumers’ choice to go to a specific retailer can be influenced by the assortment size, assortment organization and option differentiation. Since the price schemes are becoming more comparable in the Dutch market the role of assortments gets more important for the retailers. One of the key findings of Briesch et al. (2009) is that store choice decisions of the consumers are more sensitive to assortments than to prices. There are different ways in using assortments to attract customers.
2.3.1 Assortments effects
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increase the probability of choosing a store; the number of SKU’s per brand, the number of sizes per brand and the number unique SKU’s do not. But Tan and Cadeaux (2011) find that categories with a greater number of SKU’s achieved relatively higher sales revenue. And categories with increased assortments also increase sales. Chernev and Hamilton (2009) show that the relationship between assortment size and option attractiveness is concave, such that the marginal impact of assortment size on choice decreases as the attractiveness of options increases. In this study the focus will be on assortment exclusivity.
2.3.2 Assortment exclusivity
Simonson (1999) describes how offering a unique assortment is very difficult for retailers. Exclusive brand arrangements are negotiated between suppliers and retailers based primarily on mutual business benefits. An example of a retailer in the Netherlands who offers exclusive assortments is hard discounter Lidl. They rely on exclusive manufacturer’s contracts and own production facilities for its private labels (retail-week.com, 2014). The same trick can be possible with A-brands for the traditional retailers.
Retailers may adopt an exclusive arrangement because they are offered exclusive rights to sell an A-brand. This may offer a way to differentiate themselves from other retailers that sell an almost identical product assortment (Lang & Hunt, 2014). With assortment exclusivity retailers have a chance to stand out from their competitors.
2.4 Power balance between manufacturer and retailers
2.4.1 Relationship retailer and manufacturer
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state as well: in the war between manufacturers and retailers, retailers seem to be winning, mainly due to the centricity. Also because of thin margins, fierce competition and rapid change there are incentives to cooperate and rebuild the relationship.
Branded manufacturers may turn the tide by looking for a challenge in premium products that differentiatie on the basis of perceived high-value innovations and by supporting the store formulas in the realisation of differentiating capacity. This can be achieved by developing specific products for specific store formulas (Luijten & Reijnders, 2009). Good relations are necessary in order to make these type of cooperations work. Some cooperations are already there with the best known example of category management. The relation between manufacturer and retailer is getting more important for the future with the emerging cooperative differentiation in mind.
2.4.2 Category management and other
Manufacturers have come more involved in assortment decisions. They are aware that shelf space is a scarce resource and retailers want to manage assortments to be efficient and profitable (Armine & Gadenat, 2003). Additions and reducements on the assortment effects the consumer but also the costs of retailers. Retailers typically sell thousands of products across hundreds of categories and as a result they lack resources to intensively manage all the categories they sell (Gooner et al., 2011). To manage all these categories retailers search for help at manufacturers who do have the resources: category management (CM). CM involves the allocation of resources within sets of complementary and /or competing brands to maximize planned outcomes (Gajanan et al., 2007). A more intensive cooperation in CM is designating one manufacturer to a specific category, called a category captain. Some controversy around this subject arised due to the fear that manufacturers are too optimistic and favour their own brands. But Gooner et al. (2011) show in their research that with use of a category captain CM increases results without creating problems with other retailers. They encourage the cooperation between the two by advizing retailers to seek actively for effective manufacturers to collaborate and create a win-win situation. This collaboration is popular and also seen in the Dutch food market.
2.5 Exclusive collaborative differentiation
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their supplier partners and this strong alliance brings products to the markets faster, drive market share and increase sales. Manufacturers can help differentiating their products and improve the retailer’s price power by making exclusive products and packages (Dawar & Stornelli, 2013). Dutch food retailers are searching to create a competitive advantage with collaborations in which they can differentiate: cooperative differentiation with manufacturers.
Exclusive collaborative differentiation is an agreement between a manufacturer and a retailer that a specific brand, promotion, format or variety is exclusively supplied to the retailer for a certain period of time, in order to fulfill the specific needs of the retailer’s customer and to create a differentiated competitive advantage (Krabben, 2013). It can be initiated by both partners and the time of the collaboration depends on the situation.
2.5.1 Advantages and disadvantages of manufacturers in a CD
Krabben (2013) and van Everdingen (2013) names advantages for manufacturers that arise enduring a CD with a retailer. First the CD can be used to improve the relation. Indirectly this also effects the negotiation position of the manufacturer. They can reach new segments and adapt their offering specifically to a retail formula. There will be less price erosion as well because it is possible to use premium pricing. The CD will give a guaranteed shelf space which is very important for the manufacturer. Shelf space is one of the most important resources in a retail store and there is limited space with growing competition (Tsao et al., 2014). Because retailers use the exclusivity to differ from others it is likely that the product will get extra attention on the shopping floor.
There are also large disadvantages for the manufacturer like the limited product volume of a CD since they only sell their products to one retailer. This will result in low turnovers and also in lower brand awareness (Krabben, 2013). Due to the limited accessibility for the consumer the probability of investing a large marketing budget by the manufacturer will go down. This will reduce the awareness of the product in the CD and so the chance of success. Also the costs are relatively high for the development and annihilation costs. Another disadvantage is the dependency of manufacturers to the chosen retailer and the relation with other retailers.
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important to manufacturers than to retailers. It was found that retailers do value a good cooperation but less compared with the manufacturers.
2.5.2 Advantages and disadvantages of retailers in a CD
Van Everdingen (2013) sums some advantages and disadvantages for retailers as well. Retailers can differentiate themselves from competitors due to exclusivity. Premium pricing is also possible because of lacking competition. Cross-selling via the exclusive products and other products of the same brand can increase sales. The CD can also be used to improve the relationship which is important in getting these exclusive deals (Gonzalo-Hernando et al., 2003). The exclusivity will increase consumer traffic and acquire new customers to the store.
The disadvantages for retailers seem to be smaller than for the manufacturer. The disadvantage already mentioned at the manufacturer is the size of marketing support offered by the manufacturer due to the limited availability. Another risk can be the product. If a retailer wants to differ themselves with an exclusive product and it turns out that the product is not wanted by the consumer their differentiation fails and can even backfire on them in a negative way. In table 1 all the probable advantages and disadvantages of a CD are listed for both manufacturers and retailers.
Advantages Disadvantages
Manufacturer 1. Create goodwill / improve relation with that retailer
2. Guaranteed shelf space in many (or all) stores
3. Ability to control the price 4. Retailers will launch the product
with a lot of attention (POP materials, in store promotion, retailer magazine)
5. Better product – target market fit
1. Limited availability, volume, and absolute sales - not cost effective + less consumers are reached 2. Manuf. will have limited budget
for supporting the product because of limited accessibility for the consumer
3. Dependency on one retailer 4. May damage relation with other
retailers Retailer 1. Differentiation from competition
through assortment
2. No price competition for the specific product
3. Cross-selling
4. Use the CD to improve relation with consumer
5. Increased consumer traffic 6. Acquire more/new consumers to
the store
1. Manuf. may invest not much because of limited availability (in case of brand / products CD) 2. Potential risk: product
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2.6 Different types of exclusivity
According to Krabben (2013) there are different types of exclusivity which can be offered in a CD. Manufacturers can offer exclusively brands, products, variants, packaging and promotions to retailers. There are differences in importance between the types of exclusivity according to Krabben (2013): less strong types as packaging, variants and promotions can be offered to every retailer but more deep types like brand and product are only offered to large retailers.
The type of brand exclusivity is only seen in the Netherlands with the introduction of new brands (Everdingen, 2013). Examples of new brands offered exclusively are Erbens natuurijs from Green&White and Velours noir from Mondelez at retailer Albert Heijn. The CD type of products is offered more compared with brands, like Brinta brood from Heinz at Superunie. Different varieties of a product or different packages are offered exclusively as well, but are considered less important than brand and product offers (Krabben, 2013)
In the food industry an increasingly large proportion of retailer and manufacturer marketing budgets are allocated to retail sales promotion (Simpson, 2006). Sales promotion allows manufacturers of grocery products to differentiate their products from those of their competitors (Kahn & McAlister 1997). For this reason promotion can be an interesting type of CD for both retailers and manufacturers. Exclusive promotions is the most popular type on the market. A good example is receiving a free Unox cap when buying three Unox products from manufacturer Unilever exclusively at Albert Heijn.
2.7 Factors influencing the decision to start/not start CD
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According to Sloot et al. (2014) the willingness of both parties to deliver a significant performance to each other is the most important factor to decide whether or not to start with CD: what is in it for me? So factors which we know influence the chance to start a CD are the strength of both retailer and manufacturer, time of exclusivity, type of retailer, possible responses of other retailers, and willingness of both parties to invest in the CD. In our interviews we want to test this and find other antecedents which can influence this decision.
3. Research design and methodology
In this section the choice of research and data-collection will be explained and discussed. In order to explore the underlying reasons of manufacturers and retailers to start with exclusive cooperation differentiation there was a qualitative research conducted. The type of qualitative research that was used is in-depth interviews. The goal of this research is to come up with a conceptual model which includes the antecedents that influence the willingness of manufacturers to offer CD to a retailer. In the future this model can be tested quantitatively in order to make general assumptions on this topic.
3.1 Method of research
In this part the choice for the type and method of research will be clarified and justified. Also the criteria for the participants in the study will be explained in order to prove the reliability and validity of the research.
3.1.1 Type of research
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the chance of the researcher’s personal biases and idiosyncrasies (Anderson, 2010) were also considered in choosing this type of research. These limitations were accepted due to the need of discovery and understanding on this topic.
3.1.2 Method of qualitative research
One has a wide variety of methods that are common in qualitative measurement. The most common sources of data collection in qualitative research are focus groups, observations, review of documents and interviews (Thomas et al., 2011). For this research focus groups was not chosen due its limitations on the number of questions that can be asked in a session and certain group dynamics like discreteness. Observation was not an option due to the amount of time it would cost and the low probability of relevant answers observations would receive for this specific topic. Review of documents is partly used in this research through the literature research. The selected qualitative method that is used is in-depth interviews. An appropriate way in collecting data is using interviews in a qualitative method (Malhotra, 2010). According to Valenzuela and Shrivastava (2008) interviews are particularly useful for getting the story behind a participant’s experiences. The interviewer can pursue in-depth information around the topic. In this explorative research in-depth information is needed to build a complete conceptual model. Another advantage of qualitative interviewing is the much greater interest in the interviewee’s point of view: the interviewer can respond to the direction in which the interviewee takes the interview and adjust the emphasis in the research as a result of significant issues that emerge (Malhotra, 2010). So due to this flexibility every possible factor which influences the decision in starting a CD can be discussed in the interview and be included in the conceptual model. Valenzuela and Shrivastava (2008) define different types of interviews, from which this research uses the semi-structured interview: the same general information is collected from each interviewee but there is also freedom and adaptability in getting other information.
3.1.3 Interview guide
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CD for the manufacturer. Sub questions were included in the guide as well which were used as support for the interviewer when an interview got stuck or to introduce a new theme. Enduring the interviews the guide was adapted with emerged themes from previous interviews. Appendix 1.2 consists of the latest version of the interview guide, which is in Dutch due to the language spoken in the interviews. This interview guide is the basis of the received data.
3.1.3 Participants in the study
In this part the criteria for selecting the study participants are explained. Since the topic is on exclusive collaborations between manufacturers and retailers both parties are interviewed. A condition for manufacturers in order to qualify for this study is they produce A-brands in the Dutch food industry. A common condition for retailers is they sell A-brand products in most categories on the Dutch retail market. A requisite for all the interviewees is they collaborate with retailers/A-brand manufacturers on a frequent basis. In their functions within the company they should be responsible for at least one of the product categories or retailer accounts in order to receive reliable and valid data.
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3.2 Data collection
In this part the sample selection is explained and justified. Also the anonymity and confidentiality of the sample is discussed.
3.2.1 Sample selection
Qualitative research necessitates having a small sample because of the detailed and intensive work required for the study (Anderson, 2010). Based on this the sample sizes were selected on characteristics and relevance. Purposive sampling was chosen to select the individuals from these manufacturers and retailers to interview. According to Anderson (2010) this type of sampling selects individuals with characteristics relevant to the study and who are thought to be the most informative. Besides the condition of producing A-brands the sample selection was based on the product categories in which the manufacturers act their market position and the job role of the interviewee. In order to explore antecedents for manufacturers in a broad and valid way a distinction was made between the product categories when selecting the sample size. In the food and drink report of FFT-Geneva (2013) product categories were grouped into sectors. The product sectors of drinks (24%), fresh (23%), chilled (22%), ambient food/dry groceries (17%) and frozen (9%) accounted for 95 per cent of the Dutch food and drink market. The sample size of the manufacturers for this research was partly selected on the activity in those sectors. To explore possible differences in food and non-food categories the sector of non-food was taken into account as well when selecting the manufacturers.
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The focus of the study lies on the antecedents of the manufacturer to start with CD but literature review showed that the antecedents and characteristics of the retailer can play a role in this decision as well. This is why also interviews with retailers were conducted to get insight in their perspective. Four interviewees of retailers were selected based on the type of formula and again the job role. The different types were selected to explore differences in manufacturers willing to offer CD to one specific type. The degree of responsibility and influence of the job role in making possible decisions on CD was the condition for the specific interviewee to select, based again on the job title. In total 4 retailers were interviewed (See table 3)
Retailers Formula/type Job title
Retailer 1 Full service Category director Retailer 2
EDLP*,
promotions Senior category manager Retailer 3
Local full service
Commercial and marketing director
Retailer 4 -** Purchase director Table 3 - Sample selection of the retailer interviewees
*Every Day Low Pricing
** No general formula could be defined
Each interview took approximately 45 to 60 minutes and they were held in a time of 4 weeks. The speaking language was Dutch since this is the native language for all of the interviewees and the researcher. 7 interviews were done face to face and 5 interviews due to practical reasons by telephone. The method recording was for all of the interviews via audio.
Manufacturers
Product categories*
Market
leader/challenger Job title Manufacturer 1 1,3,4,5,6 Both
Vice president sales and operations planning
Manufacturer 2 4 Challenger Chief Executive Officer
Manufacturer 3 1,3 Market leader
Senior category development manager retail
Manufacturer 4 1,3 Both Director sales
Manufacturer 5 6 Market leader Director marketing
Manufacturer 6 2,3 Market leader Category development manager
Manufacturer 7 2,3 Challenger General marketing manager
Manufacturer 8 4,5 Market leader Managing director
Table 2 – Sample selection of the manufacturer interviewees
21 Literature research Interview guide Collecting data via interviews Thematic analysis Themes / categories Conceptual model
3.2.2 Anonymity and confidentiality
The method for gaining informed consent from the participants was the promise that all of the information would be processed confidential and anonymously. The confidentiality is secured in keeping identifiable information about the individuals private. This is why no names of companies and interviewees are mentioned in this research. The anonymity is secured by keeping the gained data confidential so that the data cannot get traced back to a company or an individual. This guarantee was expressed in giving no public insight into the raw captured data and in deleting all of the audio recordings after the data analysis.
3.3 Analysis
To analyze these collected data the most common form of analysis in qualitative research (Guest, 2012) was used, thematic analysis. This method emphasizes organization and rich description of the data set (Guest, 2012). With this analysis themes will be recorded which are patterns across data sets important to the description of a phenomenon and are associated to a research question (Charmaz, 2006 Thematic analysis consists of reading transcripts, identifying possible themes, comparing and contrasting themes, and building theoretical models (Guest, 2012). This analysis fits best with this research since the goal is to develop a conceptual model. Thematic analysis is based on the concept of grounded theory, which is designed to construct theories which are grounded in the data (Charmaz, 2006). In this research the constructed theory will be the conceptual model. The discovered themes are clusters in which antecedents are sorted. Findings in literature research are used to create the interview guide (see 3.1.3) and so indirectly included in the data as well. Figure 4 shows the steps to the conceptual model.
Figure 4 – Steps to the conceptual model
4. Data analysis, results and discussion
22 1. Transcription 2. Coding 3. Search for themes 4. Review and define themes 5. Conceptual model 4.1 Data analysis
Thematic analysis requires some phases according to Braun and Clarke (2006). The first phase is to get familiar with the data and transcribe the data into written form. Transcribed data can come from interviews (Braun & Clarke, 2006). The recorded interviews will be played back three times and the most important data will be written down. The second step is coding the data. Coding is the primary process for developing themes within the raw data by recognizing important moments in the data and encoding it prior to interpretation (Boyatzis, 1998). The third step is the search for themes from the codes. Step four is to review and define those themes. The end result is to include those themes into a conceptual model (see figure 5).
An inductive approach is used in the process of this data analysis, so the identified themes are strongly linked to the data because assumptions are data-driven. This approach is used because the goal of the research is to develop a new conceptual model and data cannot fit in an already existing model because this one does not exist.
4.1.1 Transcription and coding
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manufacturer to start a CD with a retailer. In the next stage of the thematic analysis these codes must be assigned to a certain theme (clustered) in order to give some structure to the results.
Positioning retailer Time of offering
Market size retailer/manufacturer Sort of products (hedonic/utilitarian)
Margins on products Online/offline
Market situation industry (Weighted) distribution of retailer Perceived commitment and believe of both parties Guaranteed volume
Preparedness of investments of both parties Advertising
Risk calculation Reach of marketing campaign
Shelf space Size of Marketing budget
Promotions The conjuncture of the market
Perceived relationship quality Relationship intensity
Relationship damage others Strategy of retailer
Size of assortment in a category Target audience retailer
Innovativeness in category Market dominance strategy
Number of A-brands in category Innovativeness
Type of CD Fit proposition retailer
Strategy of manufacturer Amount of investments
Phase product life cycle Intensity of CD by competitors
Backfire mechanisms in distribution chain Speed of rotation in category Promotion pressure in category Capabilities retailer
Size of manufacturer Price agreements
Investment possibilities manufacturer Power balance Complexity and flexibility in supply chain Business culture
Strategy of manufacturer Time of the year
Strength of brand Degree of proximity
Structure of the market Scale advantages
Imitation probability Category role of retailer
Table 4 – Codes found in transcription 4.1.2 Search for themes
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manufacturer/retailer that affect the willingness of a manufacturer to start a CD were easily assigned to this theme. The characteristics of the offer for a CD like the type of CD and the amount of volume a manufacturer would receive was found to be the fourth theme. Fifth the product category characteristics in which the CD found place emerged as a theme with codes like competitive intensity and the innovation rate. Lastly the characteristics of the relationship between a manufacturer and a retailer were combined into a theme with codes as relationship intensity and quality.
Market situation industry Imitation probability Intensity of CD by competitors Phase product life cycle
Structure of the market Promotions
Culture Shelf space
Time of the year Strength of brand
Intensity of CD by competitors Type of CD The conjuncture of the market Price agreements Backfire mechanisms in Distribution chain Amount of investments Complexity and flexibility in supply chain Time of offering
Investment possibilities manufacturer Online/offline
Size of manufacturer Innovativeness
Strategy of manufacturer Guaranteed volume
Size of Marketing budget Advertising
Degree of proximity Reach of marketing campaign
Scale advantages Innovativeness in category
Market dominance strategy Margins on products
Capabilities retailer Number of A-brands in category Market size retailer/manufacturer Promotion pressure in category Positioning retailer Size of assortment in a category Strategy of retailer Sort of products (hedonic/utilitarian) Category role of retailer Speed of rotation in category
(Weighted) distribution of retailer Perceived commitment and believe of both parties Target audience retailer Perceived relationship quality
Fit proposition retailer Preparedness of investments of both parties
Risk calculation
Power balance
25 (Economic) environment CD offer characteristics
Manufacturer characteristics Product category characteristics Retailer characteristics Manu/ret characteristics
Table 5 –Selected themes and appurtenant codes
In table 5 the themes are listed with the potential appurtenant codes from table 4. Every color represents a theme. These themes and the effect of the added antecedents (codes) are discussed and redefined in the next section.
4.2 Review and define themes
In this section the themes and including antecedents will be reviewed and defined, grounded by quotes from interviewees. Every antecedent which is included in the theme will be discussed as well as the effect it can have on the willingness of a manufacturer to offer CD. In order to see the clear relationship between the data and the interpretation of the data illustrative quotes have been used. These quotes have been translated from the Dutch transcription into English quotes. The themes form the basis of the conceptual model.
4.2.1 (Economic) environment
This theme (category) reflects the external factors which could influence the decision in starting a CD. These factors were not in control by nor the manufacturer nor the retailer. The influence of the economic environment is divided in macroeconomic variables and microeconomic variables. All of the antecedents and their effects are listed in table 6.
Conjuncture of the market
The conjuncture of the market is one of the macroeconomic variables. More than half of the interviewees acknowledged that the state of this factor influenced the chance of CD. In times of a high conjuncture there is no need to differentiate and in low conjuncture there is more creativity needed to attract customers and so the probability of CD arises. One of the retailer interviewees explains: “In a low conjuncture the chance of CD goes up because of the needed creativity, the relevance of exclusivity arises”. So a low conjuncture has a positive effect on the chance of CD. Cooperation culture
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so less chance on cooperation like CD”. When manufacturers and retailers act in a culture where the willingness is high to cooperate it positively affects the probability of CD.
High season
Busy periods can affect the chance of CD as well positively, for example in holidays or Christmas times according to manufacturer X: “there is more need for differentiation in busy periods”. Due to high expenditures of the consumer in the high season periods retailers want to be extra attractive in these periods which increase the chance of offering CD.
Market concentration and consolidation
Micro-economic variables like market situation seem to play an important role too. “Due to a high market concentration CD gets more important” says manufacturer X. The need to differentiate arises in a higher concentrated market. And so a higher market concentration can have a positive influence on CD. Manufacturer X explained: “there is more exclusivity in countries like Australia and Austria where two retailers account for 80% of the market. Here the relevance of exclusivity is way higher”. So when the market is more consolidated the relevance of CD seem to grow. More consolidation and concentration on a market increases the chance of offering CD by a manufacturer to one of the retailers.
Intensity of CD by competitors
Manufacturer X states that “one time we started a CD with retailer X as a response to a CD between our competitor Y and retailer Y”. Offering CD can be a response to a competitor who already is offering CD to a retailer. So the intensity of CD of competitor manufacturers can be a positive factor too on the willingness of a manufacturer to offer this.
Backfire mechanisms distribution chain
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Theme: (economic)
environment Definition Effect
Macro-economic variables
The conjuncture of the market High or low conjuncture -
Cooperation culture Willingness to cooperate between retailers
and manufacturers +
High season Periods of highest demand +
Micro-economic variables
Market concentration and consolidation
Extend to which a small number of firms
account for a large percentage of the market +
Intensity of CD by competitors Amount of CD offered by competitors +
Backfire mechanisms distribution chain
Strength of the negative consequences on
relationships with other retailers -
Table 6 – Economic environment
4.2.2 Manufacturer characteristics
The theme includes all the characteristics of the manufacturers which could affect the decision to start with a CD. All of the antecedents are summarized in table 7.
Market share/size
The first discussed antecedents are the market size and share. In the interviews no consensus was found if a bigger or smaller size influences the probability of CD. Retailer X states that “smaller manufacturers offer more exclusivities compared to bigger manufacturers due to volume targets” where manufacturer X state that “bigger manufacturers have more budget to invest in exclusivities”. Scale advantages of manufacturers were not per definition a positive or negative antecedent neither: “scale advantages make it hard to develop new processes” (manufacturer X). “Scale advantages can be used to create a range behind a global brand. This range can easily be offered exclusive to a retailer in other countries” (manufacturer Y). So the effect can be both positive as negative. Especially the investment budget is mentioned by all the retailers and manufacturers as an important antecedent, here defined as capabilities.
Market dominance strategy
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the differentiation”. Market leaders have more capabilities to offer CD but challenger can win more and so the relevance of challengers to offer CD can be higher. Again no accordance is found on the effect.
Customer centric strategy
The strategy of the manufacturer has influence too. Part of the strategy of manufacturer X was for example not offering CD: “we have a customer-centric strategy which means we first check what the consumer wants and later the customer (retailer). We want to serve all consumers and this is not possible when we offer exclusivity”. So having a customer centric strategy means you want to serve all consumers and so exclusivity is not an option. This strategy has a negative effect on the chance of offering a CD.
Complexity in supply chain
The complexity and flexibility of the supply chain are antecedents as well. More than half of the interviewed manufacturers believed that more complexity in the supply chain could lead to a lower chance of offering CD: “Too much differentiation could cause higher complexity in the fabrics and so more costs. More flexibility in your supply chain makes it easier to offer exclusivity” (manufacturer X). “Proximity of fabrics makes it easier to offer exclusivity” (manufacturer Y). Proximity and flexibility of fabrics affect complexity and so the chance of CD. It seems that complexity reduces the chance to offer CD.
Theme: manufacturer characteristics Definition Effect
Market share/size Strength in terms of market share,
capabilities and scale advantages +/-
Market dominance strategy Being a market leader or challenger +/-
Customer centric strategy Placing the customer at the center of
the marketing's effort -
Complexity in supply chain Degree of complexity in the supply
chain -
Table 7 –Manufacturer characteristics 4.2.3 Retailer characteristics
This theme includes all the retailer characteristics (summarized in table 8) which could influence the chance of manufacturers offering CD.
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The market share and size of the retailer was mentioned by all the manufacturers as one of the most important condition to offer a CD at that particular retailer. Mostly due to the volume a retailer can offer with a high market share. “Volume is necessary to offer exclusivity to a retailer. Small retailers do not stand a chance because of a lack of volume” (manufacturer X). Retailer X complained about this: “we ask for exclusivity but due to our low volume possibilities manufacturers do not want us as a partner”. The capabilities of a retailer play a role as well in choosing a retailer as a partner for a CD. The size of a retailer influences the chance of CD positively.
(Weighted) Distribution
High distribution was found to be a very important antecedent for all the manufacturer interviewees. “You can only be successful as a manufacturer if you have 100% distribution, because then every euro spend is worth the investment” (manufacturer X). A deficit of distribution is one of the reasons not to start with a CD for manufacturers. But when a retailer can provide a higher weighted distribution it becomes interesting to start a CD with that partner: “One of the factors which can help in coming to a unique cooperation is the weighted distribution the retailer can offer”. So the (weighted) distribution of a retailer has a positive influence on the chance of a manufacturer offering CD at that particular retailer.
Strategy of offering complete assortment
Another important characteristic of the retailer is their strategy. It turns out not all retailers want to accept a CD, even when a manufacturer is willing to offer this, because of their strategy (formula). In the following quote is an explanation from retailer X: “because of our guarantees to our consumers in our assortments, which are part of our strategy, we do not want CD’s. If we would accept those we would acknowledge CD’s from our competitors as well and this is due to our promises to the consumer not wanted since we want our assortment to be as complete as possible”. So when a retailer has the promise to its consumer to offer the broadest and widest assortment in a market it reduces the chance of CD.
Strategic fit
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audience from manufacturer Y: “If we have a product expressly for families with young children we would try to find a specific retailer with this shopper audience”. So the strategic fit with a retailer can affect the chance of beginning a CD positively.
Theme: retailer
characteristics Definition Effect
Market share/size Strength in terms of market share, volume and
capabilities +
(Weighted) Distribution Degree of (weighted) distribution +
Offering complete assortment Degree of promises to customer to offer complete
assortment -
Strategic fit Degree of fit with positioning and target audience +
Table 8 – Retailer characteristics
4.2.4 Manufacturer/retailer relationship characteristics
The characteristics of the relationship between the manufacturer and retailer are clustered into a category. In table 9 all the antecedents, definitions and effects are summarized.
Perceived quality
The perceived quality of the relationship is found as one of the characteristics. “Only on basis of a good relationship we would ask for an exclusive product”, says retailer X. So the quality of the relationship seems to affect the chance of a CD positively. However a low quality relationship could be a reason as well to improve the quality for the manufacturers. More than half of the manufacturer interviewees mentioned this as a possible motive for offering CD: “To improve the commercial relationship we could offer this” (manufacturer X) and “offering CD can be an extra gift to the relationship” (manufacturer Y). So both low and high perceived quality of the relationship can have a positive effect on CD but relations with a high quality seems to have a stronger positive effect.
Intensity
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Dependency
Dependency in the relationship was brought up too by manufacturer X: “the power balance is shifting towards the retailer. They can lay pressure on us by threating to delist products if we don’t fix margins on other products and sometimes ask fiercely for exclusive offers as well. Demanding for a CD is not possible though”. So a strong dependency of a manufacturer towards a retailer can improve the probability of CD.
Ret/manu relationship
characteristics Definition Effect
Perceived quality Degree of perceived quality +
Intensity Degree of information sharing behavior +
Dependency In terms of power balance moves towards
retailer +
Table 9 – Retailer/manufacturer relationship characteristics 4.2.5 Product category characteristics
Characteristics of product categories are found to be antecedents for CD as well (summarized in table 10). First of all CD can occur in all categories: “You can offer in each category CD” (manufacturer X)”. Specific characteristics of categories could increase or reduce this probability.
Competitive intensity
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Hedonic categories
According to manufacturer X the type of a product category can be an antecedent as well: “Hedonic categories can be more attractive to differentiate since consumers get emotionally more attached to the product”. So manufacturers in hedonic product categories could be more willing in offering CD since the chance of success is higher compared to utilitarian product categories.
Speed of rotation
By some of the manufacturers the speed of rotation in the product category was mentioned as an antecedent: “High rotation in the category makes the flexibility to offer CD hard”. No consensus was found on the effect: “low rotation in a small category reduces the chance to offer CD” (manufacturer X). High costs and low volume in the category would make the effort a waste. The effect of the speed of rotation can be as well positive as negative on CD.
Category role and growth
Also the category role and growth of a particular category can have effect on offering CD: “when a retailer wants to make a category bigger which has a good forecast and the same as our offer, there is a perfect strategic fit”. So the degree in which the category role is important for the retailer and has strong growth rates affects the chance of being offered positively.
Innovation rate
The last conducted antecedent was the innovation rate in a specific product category. “More innovations in a product category give more chances to offer one exclusive because of all the colors, tastes, smells, sizes etc.” (manufacturer X). A high innovation-rate could increase the chance positively that a manufacturer offers a CD.
Product category
characteristics Definition Effect
Competitive intensity Combination of the assortment size, number of A-brands
and the degree of promotion pressure -
Hedonic Degree in which the category include hedonic products +
Rotation Speed in which the products rotate +/-
Category role and growth Degree of importance of the category and the rate of
growth +
Innovations Rate of innovations +
33 4.2.6 CD characteristics
The theme of CD characteristics includes all the details of a CD offer which can influence the willingness of a manufacturer to offer CD. CD characteristics are formed out of two clusters: Type of CD and CD offer. The type of CD includes the characteristics of the different types and CD includes all the details of the agreements in the CD between the manufacturer and retailer. A summary of all the antecedents and their effects can be found in table 11.
Type (strength)
Different types of CD can be used according to all interviewees (in order of strength): brand, product, variety, packaging and promotions. In general the degree of importance decided the frequency of a type used. The stronger types (brand, product) were less offered compared to the less deep types (variety, packaging, promotions). All the retailers and manufacturers agreed on this antecedent: “Promotions are very often tailor-made and exclusively offered to us. Brand and product types are more complicated. The difference between a CD with a promotion offer and a brand offer is enormous” (retailer X). Retailers prefer the strongest types: “We prefer brands and products exclusive because these types give us a real advantage” (retailer X). Manufacturers offer mostly promotions, varieties and package differences. Manufacturer X: “Tailor-made promotions are standard, but important”. Manufacturer Y: “Next to promotions we use packaging and line extensions”. Manufacturer Z: “We use more exclusive ranges than brands because it is cheaper and easier to accomplish”. The strength of type of CD seems to have a big influence on the probability of manufacturers to offer CD. The stronger the type the less likely it is to offer CD and the less strong types positively influence the chance of CD.
Strength of brand
The strength of the brand under which the CD is offered can affect the decision to start as well according to manufacturer X: “On smaller brands we could offer a type of CD with more depth, on big brands not because we do not want to disappoint our consumer”. A stronger brand is less likely to be offered exclusively.
Innovativeness
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Phase of product life cycle
The phase of the product life cycle was important too for the manufacturers. New products were more often offered exclusive compared with existing ones, especially when manufacturers wanted to launch or test the success of a new product with a low budget: “the best chance to offer exclusivity at one retailer is as a test case. There are possibilities in becoming launch partners” (manufacturer X). Existing brands were hardly offered exclusive in a CD: “One of the reasons in not offering existing brands exclusive is the alternatives you have to offer to other retailers. This increases complexity”. So manufacturers are more willing to offer products exclusive when they are in the beginning of the product life cycle.
Shelf space, promotions, advertisements and guaranteed volume
The CD offer includes all the agreements made between the retailer and manufacturer. The wanted conditions that were mentioned by the manufacturers were quite similarly. The manufacturers ask in a CD support from the retailer in terms of shelf space, promotions, advertising in retailer magazines and guaranteed volume: “Advantages of a CD for us are agreements on extra listings, a good place on the shelf, lots of promotions and a minimum purchase volume” (manufacturer X). Most of the manufacturers named this.
All of these antecedents influence the chance of a manufacturer to offer CD. Amount of investments
Other characteristics were the amount of investments made by both parties. “A retailer can easily show its commitment to the CD in the amount of investments they want to make” (manufacturer X). Those investments have a positive influence on the probability of CD.
Time of offering
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CD Characteristics Definition Effect
Product/Type characteristics
Type (strength) Degree of importance of CD (brand, product,
packaging, variety, promotions) -
Strength of brand Degree of strength in terms of brand awareness,
equity -
Innovativeness Size of the innovation -
Phase product life cycle Degree of novelty of the product offered in the
market -
CD offer
Promotions Amount of promotions in store +
Shelf space Amount of shelf space in store +
Advertising Amount of advertisements +
Guaranteed volume Amount of offered volume +
Investments Amount of investments +
Time of offering The length of time the CD is offered -
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4.3 Conceptual model and discussion
All the themes and antecedents discussed in the previous part (table 6-11) form the basis for the conceptual model (figure 6). Every possible antecedent that was conducted from the interviews and its effect on the willingness for a manufacturer to offer CD to a retailer is included. The effect is expressed in plusses and mines for a positive or negative effect on the willingness of a manufacturer to offer CD. Both plus and minus behind an antecedent mean no consensus was reached on the effect.
Figure 6 – Conceptual model willingness of a manufacturer to offer CD
Since there has been little research to this topic so far it is hard to present these findings into general perspectives with previous similar research. However most of the findings are in line with the little previous similar research. Krabben (2013) concluded that manufacturers prefer stronger retailers in offering CD and weak retailers are offered the less strong forms of CD. In
Willingness of
a manufacturer
to offer CD
Manufacturer characteristics
* Market share/size/strength +/- * Market dominance strategy +/- * Customer centric strategy - * Complexity in supply chain -
Retailer characteristics
* Market share/size + * (Weighted) Distribution + * Offer complete assortment - * Strategic fit +
CD characteristics
Product/type CD Offer
* Type (strength) - * Promotions + * Innovativeness - * Shelf space + * Phase product life cycle - * Advertising + * Strength of brand - * Guaranteed volume + * Investments + * Time offering -
Product category characteristics
* Competitive intensity - * Category role and growth +
* Type + * Speed of rotation +/- * Innovation rate + Ret/man relationship characteristics * Perceived quality + * Intensity + * Dependancy + Economic environment
Macro economic variables
* Conjuncture of the market - * Cooperation culture + * High season +
Micro economic variables
* market concentration and + consolidation
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this research the strength of retailers expressed in market share, volume and capabilities is found to be an antecedent for manufacturers to offer CD as well. On the effect was however no consensus. The strength of the manufacturer is in both studies a factor as well, just as the type of CD and strength plays a role in this decision. The findings of brand strength and market share of the manufacturer as a possible antecedent matches the proofs of Krabben (2013) that manufacturers with a high brand equity and market share are less willing to CD. The found negative effect of brand strength on CD is the same as in his study. The variable found by Krabben (2013) of previous experience in CD influences the willingness of the manufacturer to offer CD was not directly found in this research. However via the antecedent of relationship intensity this could be an indirect effect. The time of the CD offered has in both studies a negative effect as well.
The backfire mechanism in the distribution chain as a found antecedent is in line with the findings of Sloot et al. (2014). In that research possible responses of other retailers were mentioned as an important reason for manufacturers to not offer a CD. Also the importance of both parties to deliver a significant performance is included is found in this research with the conditions of the CD offer to have a positive relation with the willingness of manufacturers to offer CD.
This conceptual model contributes to the area of CD since every antecedent for a manufacturer to start with CD is explored. The factors of economic environment, product category
characteristics, CD characteristics, retailer/manufacturer relationship characteristics,
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5. Conclusion
This study was conducted around the central question “What can be antecedents for A-brand manufacturers to start cooperative differentiation with retailers?”. The research explored those antecedents for A-brand manufacturers to offer cooperative differentiation to a retailer in the Dutch food sector. Several antecedents were found and categorized into six themes. The end result was a conceptual model in which all the antecedents and its effects are included (figure 6). The model shows the complexity of the decision for manufacturers to start offering a CD with all the different characteristics that can influence the willingness of manufacturers positively and negatively.
The first conducted theme was the economic environment in which the manufacturer acts. The variables were external factors which can set a more favorable situation for CD. A factor that seemed to have a strong negative effect was the backfire mechanisms of other retailers which is in line with the findings of Sloot et al. (2014).
The second theme was manufacturer characteristics. The results showed that features of manufacturers can be of importance in the willingness to offer CD. Size, capabilities, strategies and complexities all seemed to have an impact on the decision to offer CD.
The third theme found was the retailer characteristics. The model shows the willingness of manufacturers to start a CD but this research shows that retailers are not always willing to start a CD with manufacturers. Especially strategies with strict promises to customers can have a negative influence on the chance to start a CD. Further market size, distribution and a strategic fit were found to be positive antecedents.
The fourth presented theme was the characteristics of the retailer/manufacturer relationship. The intensity, dependency and quality of the relationship between a manufacturer and retailer seemed to improve the chances of starting a CD.
