diff --git a/management/src/clusterm/main.go b/management/src/clusterm/main.go
index 7e8470f..10bfd19 100644
--- a/management/src/clusterm/main.go
+++ b/management/src/clusterm/main.go
@@ -56,6 +56,19 @@ func main() {
 	app.Run(os.Args)
 }
 
+func mergeConfig(dst *manager.Config, srcJSON []byte) (*manager.Config, error) {
+	src := &manager.Config{}
+	if err := json.Unmarshal(srcJSON, src); err != nil {
+		return nil, fmt.Errorf("failed to parse configuration. Error: %s", err)
+	}
+
+	if err := mergo.MergeWithOverwrite(dst, src); err != nil {
+		return nil, fmt.Errorf("failed to merge configuration. Error: %s", err)
+	}
+
+	return dst, nil
+}
+
 func readConfig(c *cli.Context) (*manager.Config, error) {
 	mgrConfig := manager.DefaultConfig()
 	if !c.GlobalIsSet("config") {
@@ -84,16 +97,7 @@ func readConfig(c *cli.Context) (*manager.Config, error) {
 		return nil, err
 	}
 
-	userConfig := &manager.Config{}
-	if err := json.Unmarshal(config, userConfig); err != nil {
-		return nil, fmt.Errorf("failed to parse configuration. Error: %s", err)
-	}
-
-	if err := mergo.MergeWithOverwrite(mgrConfig, userConfig); err != nil {
-		return nil, fmt.Errorf("failed to merge configuration. Error: %s", err)
-	}
-
-	return mgrConfig, nil
+	return mergeConfig(mgrConfig, config)
 }
 
 func startDaemon(c *cli.Context) {
diff --git a/management/src/clusterm/main_test.go b/management/src/clusterm/main_test.go
new file mode 100644
index 0000000..d4aeb42
--- /dev/null
+++ b/management/src/clusterm/main_test.go
@@ -0,0 +1,43 @@
+package main
+
+import (
+	"testing"
+
+	"github.com/contiv/cluster/management/src/clusterm/manager"
+	. "gopkg.in/check.v1"
+)
+
+// Hook up gocheck into the "go test" runner.
+func Test(t *testing.T) { TestingT(t) }
+
+type mainSuite struct {
+}
+
+var _ = Suite(&mainSuite{})
+
+func (s *mainSuite) TestMergeConfigSuccess(c *C) {
+	dst := manager.DefaultConfig()
+	srcBytes := []byte(`{
+		"ansible" : {
+			"playbook-location" : "override-location"
+		}
+	}`)
+	exptdDst := manager.DefaultConfig()
+	exptdDst.Ansible.PlaybookLocation = "override-location"
+
+	_, err := mergeConfig(dst, srcBytes)
+	c.Assert(err, IsNil)
+	c.Assert(dst, DeepEquals, exptdDst)
+}
+
+func (s *mainSuite) TestMergeConfigInvalidJSON(c *C) {
+	dst := manager.DefaultConfig()
+	srcBytes := []byte(`{
+		"ansible" : {
+			"playbook-location" : "extra-comma-error",
+		}
+	}`)
+
+	_, err := mergeConfig(dst, srcBytes)
+	c.Assert(err, ErrorMatches, "failed to parse configuration. Error:.*")
+}