Improving the efficiency of marketing channel between a wholesaler and a retailer with uncertain characteristics

The efficiency of a marketing channel of distribution between a wholesaler and a retailer with uncertain characteristics can be improved by influencing the retailer’s ordering pattern. The wholesaler with large unit inventory holding cost can offer a large quantity discount thanks to the great benefit which comes from the transfer of part of his inventory to retailer. The retailer’s increasing average inventory holding cost can be offset by the quantity discount and by savings of the ordering cost. Conditions are derived under which a marketing channel improvement can be possible. [In Korean.]