Organizational strategy development in distribution channel management using fuzzy AHP and hierarchical fuzzy TOPSIS

Distribution channel management not only consists of choosing distribution channels. In fact, probably the most difficult phase of the distribution management starts after this choice. Determining an appropriate organization strategy for distribution channel management is like a problem of concern to marketing practitioners and academics as well in this phase. In this study, the organization strategy of distribution channel management is developed using fuzzy analytic hierarchy process (FAHP) and hierarchical fuzzy TOPSIS (HFTOPSIS) for an edible-vegetable oils manufacturer firm operating in Turkey. The company distributes its products all over the country. Due to the complex structure of the distribution network, the company wants to decide the organization strategy to manage the distribution channels. In this paper, the methods of FAHP and HFTOPSIS for evaluating and selecting among the five organization strategy models for distribution channel management of vegetable oil manufacturer have been presented. The proposed models include determinants of distribution channel management for edible-vegetable oil industry; (i) customer profile, (ii) distributor reliability, (iii) the position of competitors in market, and (iv) managerial and financial perspective. Using FAHP and HFTOPSIS, hybrid based strategy (KBS), which has the greatest desirability index value after the evaluation among the five alternatives is found as the best choice. Thus, the case of the vegetable oil manufacturer company provides the researchers and practitioners to understand in a better way the importance of developing organization strategy in channel management from a practical point of view. © 2011 Elsevier Ltd. All rights reserved.