Creating a win-win relationship by maximizing both manufacturer sales and retailer profits

In today’s business environment in Japan, manufacturers and retailers struggling against excessive price competition find themselves mired in profoundly strained relationships.

Creating a Win-Win Relationship by Maximizing Both Manufacturer Sales and Retailer Profits

Takashi KondoModel Development Group, Research & Development Office, Marketing Intelligence Division, INTAGE Inc., Japan

PRICE DESTRUCTION PLAGUES MANUFACTURERS AND RETAILERS ALIKE

Since 1990 the Japanese economy has been mired in a prolonged economic slump. In these difficult times, consumers have developed a critical eye for prices, and the phenomenon known in Japan as “price destruction” has advanced.

Price destruction has taken a particularly high toll in the market for FMCG. Figure 1depicts the change in price from 1992 to 2003 for four major FMCG categories....

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