Mechanisms that manufacturers can use to deal with misaligned retailer incentives include
A) setting a maximum retail price
B) providing an exclusive contract to a single retailer in a market
C) preventing retailers from compensating sales staff for demonstrating the product
D) eliminate manufacturer staff that was demonstrating the product in stores

Question

Quizplus · Accepted Answer

Providing an exclusive contract to a single retailer in a market can align incentives by ensuring that the retailer has a vested interest in promoting and selling the manufacturer's product, as they are the sole distributor in that market.

Mechanisms That Manufacturers Can Use to Deal with Misaligned Retailer