Final answer:
The two types of channel conflict are horizontal and vertical. Horizontal conflict occurs among companies at the same level, like two retailers.
Vertical conflict happens between different levels of the distribution process, like a manufacturer and a retailer.
Step-by-step explanation:
The two types of channel conflict are horizontal and vertical. Horizontal conflict refers to a situation where firms at the same level in the distribution process, such as two retailers, compete with each other. This can occur when two retailers carry the same brand and try to undercut each other’s prices. An example of this would be two supermarkets running promotions for the same product.
On the other hand, vertical conflict arises between different levels within the distribution channel, such as between a manufacturer and its wholesalers or retailers.
This often happens when there is disagreement over how products are marketed, the prices they are sold at, or the level of inventory to be maintained.
An example of vertical conflict is when a retailer bypasses a wholesaler to buy directly from a manufacturer, potentially undermining the wholesaler.
Conflicts are a natural part of working in close-knit environments, and while they can lead to issues, they also present opportunities for growth, learning, and innovation, if managed properly.