Linkages between product distribution and service support functions

Abstract

Examines the interfunctional linkages between product distribution and after‐sales service support functions in business organizations operating in marketing channel environments. Also discusses managerial and logistic implications of the process of selecting product distribution and service support channels in the context of specific market segments of a particular product industry. An examination of the operations of two computer equipment manufacturing firms indicates that in “low substitutability” environments, such as in the case of specialty products, manufacturing firms tend to centralize both product distribution and service support functions. In contrast, in “high substitutability” environments, such as in the case of commodity products, manufacturing firms tend to decentralize both product distribution and service support functions. These case studies suggest that both product distribution and after‐sales service support strategies are closely linked to each other. Also, several product‐, firm‐, and industry‐related attributes, which dictate the choice of product distribution and after‐sales service support channels, were identified for the computer‐equipment industry.

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