Designing Channel Networks

  • David Frederick Ross


A fundamental task of supply chain management (SCM) is structuring supply and distribution channel networks. As emphasized in Chapter 1, no business is an island. All businesses are suppliers of products and services to their customers as well as customers of some other business’s products and services. But supply chains go much deeper. In reality, all businesses are members of supply chains consisting not only of their own customers and suppliers, but also of their customers’ customers and suppliers’ suppliers. Structuring effective supply chain systems is, therefore, fundamental to the ability of all organizations to effectively leverage the resources and competencies of their channel partners to achieve competitive success.

Supplementary material

978-1-4899-7578-2_4_MOESM2_ESM.xlsx (11 kb)
Problem 1 Factor-Rating Method (XLSX 11 kb)
978-1-4899-7578-2_4_MOESM3_ESM.xlsx (112 kb)
Problem 2 Center of Gravity (XLSX 111 kb)
978-1-4899-7578-2_4_MOESM4_ESM.xlsx (100 kb)
Problem 3 Center of Gravity (XLSX 100 kb)
978-1-4899-7578-2_4_MOESM5_ESM.xlsx (14 kb)
Exercise 1 Factor-Rating Method (XLSX 14 kb)
978-1-4899-7578-2_4_MOESM6_ESM.xlsx (19 kb)
Exercise 2 Gravity Method (XLSX 18 kb)
978-1-4899-7578-2_4_MOESM7_ESM.xlsx (17 kb)
Exercise 3 Location Break-Even Analysis (XLSX 17 kb)
978-1-4899-7578-2_4_MOESM8_ESM.xlsx (12 kb)
Exercise 4 Least-Cost-Per-Lane (XLSX 11 kb)
978-1-4899-7578-2_4_MOESM9_ESM.xlsx (14 kb)
Exercise 5 Network Capacity (XLSX 14 kb)
978-1-4899-7578-2_4_MOESM10_ESM.xlsx (15 kb)
Channel Attribute Matrix Fig 4.5 (XLSX 14 kb)
978-1-4899-7578-2_4_MOESM11_ESM.xlsx (14 kb)
Comparing Distribution Network Option Performance (XLSX 13 kb)
978-1-4899-7578-2_4_MOESM12_ESM.xlsx (14 kb)
Factor-Rating Method, Table 4.7 (XLSX 14 kb)
978-1-4899-7578-2_4_MOESM13_ESM.xlsx (14 kb)
Grainger Channel Attribute Matrix Fig 4.6 (XLSX 14 kb)
978-1-4899-7578-2_4_MOESM14_ESM.xlsx (14 kb)
Gravity Method Table 4.8 (XLSX 14 kb)
978-1-4899-7578-2_4_MOESM15_ESM.xlsx (19 kb)
Gravity Method (XLSX 18 kb)
978-1-4899-7578-2_4_MOESM16_ESM.xlsx (12 kb)
Least-Cost-Per-Lane (XLSX 11 kb)
978-1-4899-7578-2_4_MOESM17_ESM.xlsx (17 kb)
Location Break-Even (XLSX 17 kb)
978-1-4899-7578-2_4_MOESM19_ESM.pptx (2.7 mb)
Chapter 4 (PPTX 2762 kb)


  1. 1.
    All references to the APICS Dictionary in this chapter are from the 14th edition (2013).Google Scholar
  2. 2.
    This definition is from Christopher, Martin. 1992. Logistics and supply chain management, 11. London: Financial Times.Google Scholar
  3. 3.
    See the discussion in Donald, J. Bowersox, and David J. Closs. 1996. Logistical management: The integrated supply chain process, 94–100. New York: The McGraw-Hill Companies, Inc.; Kotler, Philip, and Kevin Lane. 2006. Marketing management, 12th ed, 476–486. Upper Saddle River: Prentice Hall; and Goldman, Steven L., Roger N. Nagel, and Kenneth Preiss. 1995. Agile competitors and virtual organizations, 201–234. New York: Van Nostrand Reinhold.Google Scholar
  4. 4.
    Some of the topics in this section were adapted from the marketing channel design framework in Coughlan, Anne T., Erin Anderson, Louis W. Stern, and Adel I. El-Ansary. 2001. Marketing channels, 6th ed. Upper Saddle River: Prentice Hall.Google Scholar
  5. 5.
    These six points are referenced in Coughlan, et al., 169–172.Google Scholar
  6. 6.
    Seldin, Larry, and Geoffrey Covin. 2003. Angel customers and demon customers: Discover which is which and turbo-charge your stock, 41–44. New York: Portfolio.Google Scholar
  7. 7.
    This section is based on the analysis found in Chopra, Sunil, and Peter Meindl. 2010. Supply chain management: Strategy, planning, and operations, 4th ed, 73–85. Upper Saddle River: Pearson/Prentice Hall and Kotler and Lane, Marketing management, 476–491.Google Scholar
  8. 8.
    Reference the analysis in Heizer, Jay, and Barry Render. 2004. Principles of operations management, 5th ed, 306–307. Upper Saddle River: Pearson/Prentice Hall.Google Scholar
  9. 9.
    The five forms of channel power can be found in French Jr., John R., and Bertram Raven. 1959. The bases of social power. In Studies in social power, ed. Dorwin Cartwright, 150–167. Ann Arbor: University of Michigan.Google Scholar
  10. 10.
    Rangan, V. Kasturi. 2006. Transforming your go-to-market strategy: The three disciplines of channel management, 9–28. Boston: Harvard Business School Press. The choice of channel steward is far more preferable than the more commonly used term channel master, which convey a tone of command and compliance.Google Scholar
  11. 11.
    Ibid., 9–12.Google Scholar
  12. 12.
    This figure has been adapted from Coughlan, et al., 268.Google Scholar
  13. 13.
    These points are adapted from Ross, David Frederick. 2008. The intimate supply chain: Leveraging the supply chain to manage the customer experience, 93–94. Boca Raton: CRC Press.Google Scholar
  14. 14.
    Parts of this section are borrowed from Coughlan, et al., 315–344.Google Scholar
  15. 15.
    Coughlan, et al., 343.Google Scholar
  16. 16.
    Ibid., 344.Google Scholar

Copyright information

© Springer Science+Business Media New York 2015

Authors and Affiliations

  • David Frederick Ross
    • 1
  1. 1.APICSChicagoUSA

Personalised recommendations