Abstract High quality powering systems have become the requirements for computers and electronic devices users. Uninterruptible power systems (UPS) are needed in office automation, home and small and medium enterprise computers and governmental network projects. In 2006, total UPSs sold in PRC exceeded 1,279 thousand units, with a sales value exceeding 2.61 billion RMB. The UPS industry experienced an 8% stable growth backed by economy growth of PRC. This research served theoretical basis and the understanding of industry practices as the base, describing the business model of UPS industry in PRC. This thesis also contains an in-depth interview with the leader of Powercom Co., an UPS manufacturer in PRC, on topics such as channel structure (length, width and density), relation control, channel motivation (strategy in effect and methods used) and conflict management (reasons, forms and solutions), trying to combine theories and practices. This study found that Powercom experienced three channel transformations in PRC market. Phase 1: instead of touching the market directly, they entered PRC via an agent, plays only the role of manufacturer ¡V a longer, narrower channel structure, with a traditional marketing relation aims at short-term profits, and price is the incentive. When the relation went down, Powercom took destructive solutions. Phase 2: Retailing channels were established in provinces in PRC, and the PRC market was divided in to four independent geographic marketing sectors, no intersection selling were allowed ¡V allowing the four sections to have their own storage and selling systems and compete with each other, resulting horizontal conflicts between section sellers. Phase 3: the marketing efforts are directed by a Great China concept, although the four offices still in charge of dealing orders and selling, no geographical restrictions exist. The channel structure was turned from density to selective distribution. Their relation with distributors are thus turned in to vertical systems, thus common objective, instead of price alone is the incentive to motivate firm members. Keywords: Uninterruptible power systems, cannel transformation