Inventory and Eort Choice When a Sales Agent Possesses Private Demand Information
- Topics:
- Sales Force Design
- Tags:
- Agent,
- Business Operations,
- Principal,
- Product,
- Real Estate,
- Sales,
- Sales Strategy,
- University Of Rochester
- Source:
- University of Rochester
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Overview: The inventory planning decision of a firm (principal) is considered in the situation where a sales agent possesses better information about future product demand than the principal. This could occur simply because the agent has more familiarity with the customers than the principal, giving him a better signal of demand. This is especially plausible where the new product is similar to a previous product and/or the new product is a substitute for a previous product. Because the agent has an established relationship with many if not most of the potential clients, he is likely to have better knowledge of true demand for a new product.
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Format: PDF | Size: 105KB | Date: May 2005 | Pages: 6




