Slotting allowances in China: Theory development and regulation formulation strategy

Abstract

Under normal market competition, charging suppliers for slotting fees by retailers is a normal business practice. Although it is prevalent in China, the rationalities of slotting fees for established products and linear slotting fees are doubtful. The relevant departments of governments need to supervise and regulate these types of slotting fees. There are two available regulation formulation strategies: we can either learn from Japan to ban explicitly certain types of slotting fees, or learn from America to adopt an attitude of laissez-faire towards slotting allowances.

Keywords

slotting allowances, suppliers, retailers, welfare