Industrial buyers' risk aversion and channel selection

A variety of risk reduction strategies have been used by industrial buyers to cope with both personal and organizational risk incurred in the buying process. However, the issue of channel selection has heretofore not been addressed. This study examines the question of whether buyers use channel selection as a means of reducing both financial and performance risk in industrial purchasing. The results show differentiation in the channels chosen by industrial buyers according to various characteristics of the buying situation, leading to the conclusion that both financial and performance risk impact channel selection.