CHANNEL CONFLICT

Horizontal Conflict


Probable Issues:
Hi Fashion is planning to go for Intensive distribution, with 5600 outlets in Delhi, 2400 in Ludhiana and 2400 Jaipur, apart from those in other cities. But Knitwear being a shopping good, selective distribution would be more appropriate for it. Due to the presence of so many outlets in a single city, there is a possibility of transgression of operating domains and undercutting. If Hi Fashion is planning to start its own company outlets, these outlets too can compete with their existing outlets.

Proposed Solutions :

Hi Fashion should restrict their outlets to a number where they do not infringe upon the customer base of another outlet. Company outlets, if opened, can stock seconds goods, instead of the ones stocked in their retail outlets.

CHANNEL CONFLICT


Vertical Conflict


Probable Issues:
There can be a conflict between Hi fashion and its retailers due to the following reasons:

Hi Fashions goal would be gaining market share, while that of the retailers would be short-term profitability. There can be a difference in the perception of market conditions between Hi Fashion and its retailers and this might lead to conflicts such as disagreements over the inventory stock, advertising etc. Hi fashion can have an agreement with their retailers, clearly demarcating the operating domains, roles and responsibilities.

Proposed Solutions:

CHANNEL CONFLICT


Multichannel conflict


Probable Issues:

If Hi Fashion starts an Online portal for selling its products, there might be a conflict between its existing retailers and this portal. To avoid this conflict, Hi Fashion can decide to limit the products available online, to a particular price range or a particular variety, so that their sales dont cut into the sales of the retailers substantially.

Proposed Solution: