Increasing distributor performance: implementation of an incentive system for distributors in compliance with competition law

Abstract

This paper examines the impact of monetary and non-monetary incentives on distributor performance in a case company. It assesses how incentives influence motivation, loyalty, and relationship quality. The study uses qualitative research with key account managers, revealing that both monetary and non-monetary incentives are crucial in motivating distributors, while monetary incentives drive immediate performance, and non-monetary rewards foster long-term commitment. It suggests that trust is important for performance, but overemphasis on commitment can be counterproductive. The findings advocate for a mixed incentive system that aligns with distributors' needs and performance goals, challenging the importance of loyalty as a performance driver.