Abstract
The purpose of this research is to consider total system integration in distribution channels. A distribution channel consists of two broad subsystems, namely the channel management activities and the physical distribution activities. In order to obtain integration of the two subsystems, a simulation model is proposed based on inputs and outputs. The inputs consist of resources and capabilities of each subsystem. The outputs are the results or objectives of the distribution channel for the firm. The model jointly addresses distribution objectives and resources and capabilities of the firm and determines important factors of channel performance.
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