Sharing of selling functions in distribution channels and distributor outcomes: The role of solution selling capabilities and uncertainty

Abstract

Despite the extensive research on channel governance and inter-firm relationships over the last decades, the literature offers limited insights into the sharing of functions between suppliers and their distributors. This issue has gained particular relevance in recent years, as both suppliers and distributors have sought to adapt to increasingly competitive environments by changing their revenue-generation models to focus more on servitization while providing customer solutions. This paper adopts the distributor's perspective to investigate how supplier involvement in selling functions to sell to the distributor's customers impacts the distributor's financial performance. Focusing on a sample of industrial resellers for whom non-product revenues represent an important share of their overall revenues associated with selling a supplier's product line, this paper demonstrates that supplier involvement negatively impacts distributor financial performance—an effect that is moderated by distributor solution-selling capabilities and environmental uncertainty.