Dealer Network Research Articles

Dealer Networks and the Cost of Immediacy

We show that uninformed corporate bond index trackers pay lower transaction costs when they request immediacy from dealers with central network positions. This centrality discount supports recent network models in which core dealers have a comparative advantage in carrying inventory. We show that core dealers provide more immediacy and revert deviations from their desired inventory faster. When dealers trade with other dealers, we find a centrality premium consistent with core dealers exploiting their comparative advantage to extract more surplus when bargaining with peripheral dealers. We rule out alternative explanations based on adverse selection and customer clienteles.

Relationship Trading in Over‐the‐Counter Markets

ABSTRACTWe examine the network of trading relationships between insurers and dealers in the over‐the‐counter (OTC) corporate bond market. Regulatory data show that one‐third of insurers use a single dealer, whereas other insurers have large dealer networks. Execution prices are nonmonotone in network size, initially declining with more dealers but increasing once networks exceed 20 dealers. A model of decentralized trade in which insurers trade off the benefits of repeat business and faster execution quantitatively fits the distribution of insurers' network size and explains the price–network size relationship. Counterfactual analysis shows that regulations to unbundle trade and nontrade services can decrease welfare.

Bid-ask spreads and the over-the-counter interdealer markets: Core and peripheral dealers

This paper studies heterogeneity in search technology among dealers in an over-the-counter (OTC) market. Empirical evidence suggests that in many OTC markets dealer networks have a core-peripheral structure with customer bid-ask spreads depending on whether a customer trades with a more central dealer or a more peripheral dealer. The paper develops a baseline search and matching model, which produces a robust centrality discount—lower bid-ask spreads offered by more central dealers. When dealers are allowed to move sufficient amounts of trading capital between their idiosyncratic states the same model parameters may produce a centrality premium. Numerical analysis of the model shows the effects of different underlying distributions of the heterogeneity in search technology on dealer networks and welfare.

A Survey of the Microstructure of Fixed-Income Markets

This paper surveys the literature that studies fixed-income trading rules and outcomes, including Treasury securities, corporate and municipal bonds, and structured credit products. We compare and contrast the microstructure and regulation of fixed-income markets with equity markets. We highlight the nature of over-the-counter trading in the face of search costs and the associated slow evolution of electronically-facilitated intermediation. We discuss the databases available for the study of fixed-income microstructure, as well as measures of trading costs and the determinants thereof, and the important roles of dealer networks and limited transparency. We also highlight unresolved issues.

Transparency and dealer networks: Evidence from the initiation of post-trade reporting in the mortgage backed security market

We examine the introduction of mandatory post-trade reporting in the To-Be-Announced mortgage-backed securities market. With post-trade reporting, trading costs fell for institutional investors. Trading costs declined more for investors’ trades with peripheral dealers than for their trades with core dealers. Peripheral dealers’ market share dropped after the introduction of post-trade reporting, suggesting that opacity was protecting inefficient high-cost dealers. Interdealer trades and volume declined as transparency made it easier to find natural counterparties. Relationships between dealers became less important and, after controlling for the number of trades, dealers used more counterparties in interdealer trades.

ВНЕСОК РОДИНИ БЕКМАННІВ У РОЗВИТОК АВТОМОБІЛЬНОГО ТРАНСПОРТУ ЄВРОПИ НА ПОЧАТКУ ХХ СТ.

he formation of the automotive industry in Europe in the early twentieth century was considered. The data about car development in Great Britain, France and Germany is given. It was shown how the automobile racing influenced on the development of cars, in particular the transition from cars creation with a steam engine to cars creation with an internal combustion engine. More and more people became interested in this type of transportation. It was shown that at that time in Europe there were many workshops where cars were developed by scientists-innovators. Among such pioneers of the car industry is to Beckman's family. The activity of this family starting from Paul Beckman to his son Otto Jr. and even his daughter Ilse is presented. To date, it is extremely limited information about Beckmann's family contribution to the automotive industry in Europe. It was Paul Beckmann who started constructing cars in Wroclaw. At the factory which was founded by his father the production of both as small cars and as trucks and even sports was organized. It is noted that before the beginning of the World War I the most efficient cars developed a speed of up to 95 km/h. Beckmann's family cars became prize-winners of the international competitions of that time. It is stated that Paul Beckman can be considered the initiator of a safety belt. His cars were equipped with special leather straps. It should be noted that the company successfully developed and had a dealer network in Germany, Poland and Russia. During the interwar period, the company collapsed and was bought by a larger brand. However, Otto Jr., son of Paul Beckman, continued to take care of a family business. Today there is only one car with the mark of the Wroclaw car factory.

Impact of Reinforcing Agro Dealer Networks on Agricultural Productivity in Niger

Agricultural production in Niger has been plagued with low productivity and, as such, low incomes for the majority of the country’s small-scale farmers, due largely to poor soil quality and arid climate conditions. Input-use is a crucial part of the solution to these problems. However, the rate of adoption remains low among farmers in Niger. One way in which they hoped to deal with this challenge was to train agro-dealers in three regions in Niger namely, Maradi, Tahoua and Zinder. This study sought to evaluates the effect of agro-dealer training in input use and handling, and crucial business practices, on the behaviours of the small-scale farmers that they serve. The evaluation looked at the performance of two treatment groups, who received training only or training plus demonstration, randomly assigned to agro-dealers. Though the design of the study followed a randomized phased-in approach and an IV approach in estimating the impact. The main findings of the study were Training plus demonstration plots increased adoption of improved seed, showing the added value of the demonstration component in the intervention, in encouraging seed use.

The Effects of Transparency on Trading Profits and Price Informativeness: Evidence From Corporate Bonds

We examine the effects of post-trade transparency on intermediation in the over-the-counter corporate bond market using the staggered introduction of TRACE as a natural experiment. Post-trade transparency leads to increased trading volume and more connected dealer networks. Transparency reduces dealers' profitability but also their portfolio risk and adverse selection costs. In contrast to prior research suggesting that TRACE benefits customers at the expense of dealers, we show that the net effect on dealer welfare is ambiguous. Bond spreads are less predictive of default in a transparent market, consistent with reduced profitability of informed trade weakening incentives to produce information.

ОСОБЛИВОСТІ РОЗВИТКУ МІЖНАРОДНОГО МАРКЕТИНГУ ВИСОКИХ ТЕХНОЛОГІЙ В УМОВАХ ГЛОБАЛІЗАЦІЇ

The article explores the key development trends for international marketing in the area of high-tech entrepreneurship. Specific features of international marketing are determined by the particular characteristics of external environment in which it is implemented. In the first place, an emphasis is made on the critical role of the national government in shaping foreign economic policy. It can either facilitate favorable conditions to enhance international economic activities or on the contrary, the government may be uninterested in the process and create certain barriers to some of the firms in their entry in foreign markets. Reasons have been provided for the relevance of using the specifics of hi-tech marketing in the high-end industry context. It should be noted that the marketing practice adapted for ordinary goods and services proved to be ineffective in the field of high technology and at the international level in particular, thus triggering the need for the research on the development of marketing concepts and tools that can be applied to a specific category of goods – the category of hi-tech. Apparently, it is possible to assert that high-technology marketing is of a specific nature. Such areas of traditional marketing as building positive consumer perception, creating strong competitive advantage, designing promotion models, developing infrastructure and dealer networks, etc. are transforming their content as soon as they are applied within high technology market. It has been revealed that the principles of international hi-tech marketing differ significantly from mass marketing paradigm where standard tools, traditional sales and promotion models prevail. It overturns the traditional business approaches assuming that a single company cannot change common and well-established patterns developed over the years.

The Contribution of Dealers to Competitive Advantage of Manufacturers

Most automobile manufacturers use a network of franchised dealers to sell and service their products. These dealers perform the initial sales process as well as deliver after-sales services. Some arguments and studies suggest that the quality of the sales process and subsequent post-sales services can impact sales, repeat sales, and reputation. Other arguments and studies suggest that dealer services are a commodity and that their quality may only impact sales in the extremes. We expand from previous studies by considering both the dealer and their dealership network, consisting of other dealers in the area that compete for sales. We observed a total of 105,080 automobile sales in the US over 32 days. This yielded daily sales and consumer rating information for all dealerships and all new cars in inventory in five car classes. We find that dealer quality positively influences automobile brand sales. Brands with highly rated dealer networks also had higher market share. The results show that dealer service quality has a stronger effect in markets where the focal brand’s dealer network is sparse and the competing dealer networks are dense. Finally, we find that quality of after-sales service have a stronger effect on market share than that of the sales process.

STUDY THE ADVERTISEMENT AND PROMOTIONAL IMPACT ON FMCG SECTOR IN RURAL PUNE DISTRICT AND THE OVERALL POTENTIAL OF THE RURAL MARKET

In country like India, where the 70% of the people live in rural area, the rural market holds a lot of marketing potential. There is a wide spread difference in the standard of living between urban and rural India. In order to launch products and develop advertising for rural market there is a need to understand both the rural context and also the consumer very well. Promotion of brands in rural markets requires the special measures. Due to the social and backward condition the personal selling efforts have a challenging role to play in this regard. The word of mouth is an important message carrier in rural areas. In fact the opinion leaders are the most influencing part of promotion strategy of rural promotion efforts.The strong Indian brands have strong brand equity, consumer demand-pull and efficient and dedicated dealer network which have been created over a period of time. The rural market has a grip of strong country shops, which affect the sale of various products in rural market. The companies are trying to trigger growth in rural areas. They are identifying the fact that rural people are now in the better position with disposable income. The low rate finance availability has also increased the affordability of purchasing the costly products by the rural people. Marketer should understand the price sensitivity of a consumer in a rural area. This research paper will be therefore an attempt to study the Advertisement and Sales Promotion impact on FMCG Sector in rural India and the overall potential of the rural market.

What drives home market advantage?

In the automobile industry, as in many tradable goods markets, firms usually earn their highest market share within their domestic market. The goal of this paper is to disentangle the supply- and demand-driven sources of this home market advantage. While trade costs, foreign production costs, and taste heterogeneity all matter for market outcomes, we find that a preference for home brands is the single most important driver of home market advantage—even after controlling for brand histories and dealer networks. Furthermore, we also find that consumers favor domestically producing brands even if these brands originated from a foreign country. Therefore, our results suggest a novel demand effect of FDI: Establishing local production increases demand for the brand even in the absence of any cost savings.

Развитие компетенций персонала сервисно-сбытовой сети российских автомобильных компаний в контексте требований стандарта ГОСТ Р ИСО 9001-2015

The personnel of the entities of corporate dealer network of automobile company have direct interaction with final consumers of products of the company, quality of the provided service and sales services and quality of process of customer service depends on the level of his competence. The new version of the standard GOST R ISO 9001-2015 contains a number of requirements for continuous competence development of personnel. Satisfaction of this requirement is possible on the basis of competence approach, within which came the development of a competency concept that reflects the most progressive scientific views on the development of staff competencies.
 Analysis of scientific literature allowed to reveal the feasibility of using the definition of the competence of employees of the dealer centers of the automotive company techniques based on the qualimetric assessment of personnel. Its application in combination with ranging of workers on the reached competence-based levels in relation to various categories of personnel will allow to increase justification of functional distribution of job responsibilities.
 It is revealed that forming and development of system of corporate training acts as the main form of personnel development of the modern entity of automotive industry. On the example of the Russian automobile companies it is shown that all of them have the operating training systems of personnel of service and sales network in the form of the organization of multi-profile training centers. However, only in recent years, these centres began to turn attention to the development of competences not only technical, but also the service personnel of the dealer centers.
 It is offered to expand an arsenal of the applied methods of personnel development of the entities of service and sales network of automobile company by means of more active application of the approaches used in foreign practice – Secondment and Shadowing. In article the short characteristic of these technologies is provided and the directions of their applied application in case of development of specific competences of personnel of the automobile dealer centers are proved.

Application of quantitative and qualitative methods for determination of priority development directions of companies implementing lean manufacturing

This article covers the issues of integration of qualitative and quantitative methods applied when justifying management decision-making in companies implementing lean manufacturing. The authors defined goals and subgoals and justified the evaluation criteria which lead to the increased company value if achieved. The authors identify the most important top-level rating indicators: receiving a profit and increase in cash flow. The lower level includes criteria: 1) created value, sales volume, productivity, customer satisfaction; 2) net cash flow, turnover of current assets, EBITDA; 3) amount of accounts receivable; acceleration of the time from receipt of the order to receipt of money, expansion of own dealer network; 4) loss reduction, reduction of indirect costs, reducing inventory. The application of the analytic hierarchy process and the involvement of experts of various services allow accelerating management decision-making with regard to the determination of the priority development directions in the current economic conditions and making the process objective to the maximum.Keywords: analytic hierarchy process, lean manufacturing, management accounting, decision-making

Integrating Commercial Fisheries Registration, Education, and Social Science in the U.S. Virgin Islands

AbstractThe collection of economic data on commercial fisheries without a formal dealer network often requires time and labor‐intensive field research. Previous fisheries social and economic research in the Caribbean has embraced stratified or cluster sampling techniques as an efficient alternative to seeking large random samples. We explore an alternative approach wherein fisheries education and research are incorporated into a registration process structured around small group interactions in the U.S. Virgin Islands (USVI). We find that this approach can raise response rates and save considerable effort, but the surveys themselves must be very brief.Received February 11, 2016; accepted October 28, 2016 Published online March 1, 2017

Universidade corporativa e desenvolvimento de competências: estudo em uma rede de concessionárias do setor automotivo.

This article aims to characterize the Institute Per Lo Svilupo Organizzativo (ISVOR), an important Corporate University (UC) of the automotive sector, based on the critical factors considered by Eboli (2014) and check its performance in the development of professional competencies. For this, a case study was carried out in a network of concessionaires of a truck factory linked to a group with a strong worldwide presence, with emphasis on the development of the Master's skills, a professional who is specialized in diagnostics and plays a relevant role in the assistance After-sales service. The data were collected through semi-structured interviews, questionnaires and document analysis - qualitative data were analyzed by content analysis and quantitative data using descriptive statistics. They surveyed 27 research subjects, including professional Isvor and dealers. It was found that the architecture adopted by Isvor contemplates the critical factors indicated by Eboli (2014), there is room for improvement. By stimulating the development of Master professional competencies, Isvor favors the competitiveness of the dealer network units.This article aims to characterize the Institute Per Lo Svilupo Organizzativo (ISVOR), an important Corporate University (UC) of the automotive sector, based on the critical factors considered by Eboli (2014) and check its performance in the development of professional competencies. For this, a case study was carried out in a network of concessionaires of a truck factory linked to a group with a strong worldwide presence, with emphasis on the development of the Master's skills, a professional who is specialized in diagnostics and plays a relevant role in the assistance After-sales service. The data were collected through semi-structured interviews, questionnaires and document analysis - qualitative data were analyzed by content analysis and quantitative data using descriptive statistics. They surveyed 27 research subjects, including professional Isvor and dealers. It was found that the architecture adopted by Isvor contemplates the critical factors indicated by Eboli (2014), there is room for improvement. By stimulating the development of Master professional competencies, Isvor favors the competitiveness of the dealer network units.

Application of intermediaries motivation in the distribution channels of car market

The object of research is the policy of motivation and training. Practice shows that the main problem of automakers today is motivation of intermediaries in the distribution channels and qualifications of their staff, i. e. staff training. This applies particularly to car dealers, as revenue from car sales fall every year and profitability of car sales too low, sometimes only 3 % of the sale price of the car, so it is important to further motivate all intermediaries in the distribution channels in the chain of distribution by automaker. Equally important in the activity of automakers and dealer network is a system of education and training for the automotive industry due to the fact that consumers trust more direct contact with the seller and less – advertising.The method of research is the general scientific methods such as systems analysis, synthesis, induction, deduction, abstraction and special scientific methods, including methods of sociological research and comparison.Materials are theoretical research of scientists, statistics and practical knowledge and experience of the author in the car market of Ukraine.The obtained results allow automakers to introduce an effective motivational system for sales of car and spare parts, as well as providing quality service. But it should be noted that any motivation will work provided the combination of material and non-material incentives. Equally important in the activity of automakers and dealer network is an effective system of education, training and retraining for the automotive industry. We propose to organize education and training of specialists using two-level training matrix, which includes the system of training young professionals and staff training system.

Dealer Networks in the World of Art

We apply network theory to study auction outcomes in the fine art market. Using a unique historical data set, of London-based art auctions that took place between 1741 and 1913, we investigate the drivers of strategic network formation between dealers (buyers) and sellers and the effect of network structure on artwork prices and market exit. The network size and similarities in art specialization between trading partners strongly influence the decision to form links. A larger network and a higher degree of specialization exacerbate informational asymmetries across buyers leading to higher rents through lower prices and facilitate longer market presence.

Logistical Costs Minimization for Delivery of Shot Lots by using Logistical Information Systems

The article considers the possibility to reduce logistical costs using optimization of the supply chain management with the help of a decision support system. It was shown that the implementation of such systems at the transport companies allows to choose the best available options of transport route and mean of transport. It concerns in the first instance enterprises, which have an extensive dealer network and focus on deliveries of shot lots on delivery routes. The developed algorithm to make a reasonable management decision concerning the choice of route and delivery schedule gives an opportunity to manage optimally a vehicle fleet and to reduce idle runs.The optimization of delivery routes is based on the minimization of fleet usage, their total run and standing time as well as takes into account traffic intensities on road sections. It allows also to reduce transport load on the road network, which leads to improve ecological situation in the city. The model for the city of NaberezhnyeChelny was built and tested within the scope of research. Its implementation gives a possibility to correct proposed routes in such a way as to avoid “problem” parts of road network.

PROBLEMS AND PROSPECTS FOR DEVELOPMENT OF MANUFACTURE OF HIGH-CAPACITY GAS TURBINE PLANTS IN THE RUSSIAN FEDERATION

The tasks of ensuring reliable and uninterrupted supply of electricity to consumers, industrial and environmental safety, the ability to monitor the state of energy equipment, to forecast and prevent emergencies, with the current situation in the energy sector taken into account, are becoming top priority areas for development of the industry’s production complex. Developments in the foreign policy and the global economic situation have signifi cantly changed the market conditions for manufacturers of power equipment, generating new challenges to Russia’s power engineering. Solving the problem of innovative development of the Russian power engineering industry has its specifi cs. First, the equipment used at the power industry facilities of the Russian Federation is mostly foreign-made, previously purchased and not requiring replacement in connection with expiration of its service life. Second, foreign-made equipment has improved technical and operational characteristics, is easy to use, can be maintained with a guaranteed supply of spare parts, and is provided with easily integrated complementary goods, such as software for industrial plant management, additional industrial safety systems, etc. Third, the manufacture and assembly of foreign equipment are localized mainly at places of the greatest demand, which gives an additional advantage to foreign producers for its delivery and subsequent maintenance. Fourth, the sale and support of foreign-made equipment are carried out by a well-organized dealer network. Fifth, one should note the high level of organization of technological processes for development, introduction and production of foreign equipment. It is based on these specifi c features that the structure of energy needs in high capacity gas turbines is formed, and the prospects for development of power engineering in this area are substantiated, the needs are shown, and the power rating values are substantiated for gas turbines for machine-building plants to place orders. The retrospective analysis of turbine construction in Russia enables to determine the prospects for its development. Successful development of turbine construction in Russia requires creating industrial and organizational infrastructure. Conclusions drawn as a result of analysis of the problem are of practical signifi cance and form an innovative way of development of heavy energy machine building.