Administered vertical marketing channels exist when one member of the channel takes the initiative to lead the channel by applying the principles of effective interorganizational management.

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Administered vertical marketing channels are characterized by one dominant member who takes charge of managing the relationships between the other members of the channel. This member may be a manufacturer, wholesaler, or retailer who has the power to coordinate distribution, promotions, pricing, and other activities within the channel. This leadership role is based on the member's superior resources, expertise, reputation, or bargaining power, as well as the willingness of the other members to follow their direction. Effective interorganizational management is essential to maintain the cooperation and alignment of the channel members toward common goals and mutual benefits.

Administered Vertical Marketing Channels Exist When One Member of the Channel