Question: A recent innovation by Amazon, the Vendor Flex program, seeks to lower overall transportation costs but also creates new forms of channel conflict with competitors.

A recent innovation by Amazon, the Vendor Flex

A recent innovation by Amazon, the Vendor Flex program, seeks to lower overall transportation costs but also creates new forms of channel conflict with competitors. As a partner in the Vendor Flex program, P\&G agreed to allow Amazon to build fulfillment centers within P&G 's own warehouses, thus helping to eliminate some of the costs of transporting P\&G's products to Amazon's fulfillment centers. Believing that the program was giving its competitor Amazon an unfair advantage, Target reacted vigorously, moving all P&G products from prominent end-cap positions in its stores to less prestigious and less visible locations. Target also stopped using P\&G as its primary source of advice for planning merchandising strategies within each category. This is an example of channel conflict. horizontal conventional independent vertical coercive

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