Implications of product centric servitization for global distribution channels of manufacturing companies

Abstract

Purpose

The ability to operate global distribution channels of products is commonly considered a critical determinant of a manufacturer’s competitiveness. Nowadays, many products are often complemented with value-added services challenging the efficacy of the status quo of distribution channels. Investigating this rather new phenomenon, the purpose of this paper is to provide an initial understanding of the implications of servitization for manufacturers’ global business-to-business (B2B) distribution.

Design/methodology/approach

The aim is to elaborate service-dominant logic (SDL) in the context of global B2B distribution. The study builds on case study data collected from a medium-sized European manufacturing company offering production equipment and solutions, and three of its global distributors.

Findings

The results indicate that the co-producing customer value, the increasing role of operant resources of both a distributor and a manufacturer, and triadic co-creation between a manufacturer, a distributor and an end customer have increasing importance in the indirect distribution network.

Research limitations/implications

Data are limited to data collected from a single in-depth case study. The results of this study should be investigated by collecting more data in a broader context in the form of surveys.

Practical implications

Several guidelines related to global distribution are developed for managers, and current distributor selection criteria are completed to meet the needs of this servitization approach.

Originality/value

Empirical research on servitizing manufacturers with global B2B distribution is scarce. This paper employs SDL to provide an in-depth understanding of the implications of servitization for distribution.

Citation

Aminoff, A. and Hakanen, T. (2018), "Implications of product centric servitization for global distribution channels of manufacturing companies", International Journal of Physical Distribution & Logistics Management, Vol. 48 No. 10, pp. 1020-1038. https://doi.org/10.1108/IJPDLM-06-2018-0231