Explain five circumstances under which a manufacturer may modify an existing channel arrangement.(10 marks)November 2022

A manufacturer may choose to modify an existing channel arrangement for various reasons, such as:

1. Changing market conditions: The manufacturer may need to adapt to changes in the market, such as shifts in consumer demand or the emergence of new competitors, by modifying its channel arrangement to better reach its target market.
2. New product launch: The manufacturer may need to modify its channel arrangement to accommodate the launch of a new product, such as by adding new distribution channels or adjusting its pricing strategy.
3. Improved efficiency: The manufacturer may aim to improve the efficiency of its channel arrangement by streamlining processes, reducing costs or increasing the speed of delivery.
4. Increased market share: The manufacturer may attempt to increase its market share by expanding into new geographic areas or by targeting new customer segments through modifying its channel arrangement
5. Brand Repositioning: The manufacturer may attempt to reposition its brand to align it more closely with the target market and its needs, for example by using different distribution channels or by adjusting its pricing strategy.
6. Merger or acquisition: The manufacturer may choose to modify its channel arrangement following a merger or acquisition, for example by consolidating distribution channels or by rebranding.
7. Legal requirements: The manufacturer may need to modify its channel arrangement in order to comply with legal requirements, such as changes in regulations or product labeling laws.
8. Channel conflict: The manufacturer may need to modify its channel arrangement to resolve conflicts with existing channels, such as by adjusting pricing or by redefining the roles and responsibilities of its channels.
9. Improved customer service: The manufacturer may aim to improve customer service by modifying its channel arrangement, for example by adding new distribution channels or by increasing the level of support provided to its existing channels.
10. Channel performance: The manufacturer may modify its channel arrangement to improve the performance of its existing channels, for example by providing additional training or support, or by adjusting the terms of the relationship with its channels.