Problem definition: Slotting fees are lump-sum payments retailers demand from manufacturers to include manufacturers’ products in their assortments. Although retailers regard slotting fees as part of doing business, some manufacturers claim that slotting fees limit their ability to compete on a level playing field with other manufacturers. Considering these conflicting views, we study the role of manufacturer competition in the emergence of slotting fees and how slotting fees affect retailers’ category management (i.e., assortment and pricing) decisions. Methodology/results: We consider a game-theoretic model with a single retailer and two competing manufacturers, each offering a single product. The retailer makes slotting fee, assortment, and pricing decisions in the presence of an operational cost term that increases in the assortment size. The manufacturers that can afford the slotting fee set the wholesale prices for their products. This study leads to three key findings. First, slotting fees can be suboptimal when their absence would trigger intense wholesale price competition. Second, depending on the retailer’s operational cost and the intensity of manufacturer competition, slotting fees create three distinct effects -category expansion, rent extraction, and competitive exclusion under which product variety (i.e., the retailer’s assortment size) increases, remains unchanged, and decreases, respectively. Third, slotting fees are most (least) beneficial for the retailer when they lead to a decrease (increase) in product variety. Managerial implications: This study not only illustrates that retailers can use slotting fees as a strategic tool to control the intensity of manufacturer competition but also reveals how slotting fees impact retailers’ assortment and pricing decisions, with implications for manufacturers and policy makers.Supplemental Material: The online appendix is available at https://doi.org/10.1287/msom.2022.0143 .

中文翻译：

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零售品类管理（含进场费）

问题定义：进场费是零售商要求制造商一次性支付的费用，以将制造商的产品纳入其分类中。尽管零售商将进场费视为开展业务的一部分，但一些制造商声称，进场费限制了他们与其他制造商在公平竞争环境中竞争的能力。考虑到这些相互矛盾的观点，我们研究了制造商竞争在进场费出现中的作用以及进场费如何影响零售商的品类管理（即分类和定价）决策。方法/结果：我们考虑一个博弈论模型，其中有一个零售商和两个竞争制造商，每个制造商都提供一种产品。零售商在分类规模增加的运营成本条件下做出进场费、分类和定价决策。有能力支付进场费的制造商为其产品设定批发价格。这项研究得出了三个关键发现。首先，当进场费的缺失会引发激烈的批发价格竞争时，进场费可能不是最理想的。其次，根据零售商的运营成本和制造商竞争的强度，进场费会产生三种不同的效应——品类扩张、租金提取和竞争排斥，在这三种效应下，产品品种（即零售商的品种规模）增加、保持不变和减少， 分别。第三，当进场费导致产品种类减少（增加）时，对零售商最有利（最不有利）。管理意义：这项研究不仅说明零售商可以使用进场费作为控制制造商竞争强度的战略工具，而且还揭示了进场费如何影响零售商的分类和定价决策，对制造商和政策制定者具有影响。补充材料：在线附录可在 https://doi.org/10.1287/msom.2022.0143 获取。