Managing channel coordination in a multi-channel manufacturer-retailer supply chain

With the rapid development of e-commerce and the adoption of dual channels, increasingly manufacturers and retailers are implementing differentiated branding and profit sharing strategies in order to improve channel coordination and supply chain performance. In this study, we focus on the strategic roles played by differentiated branding and profit sharing in a multi-channel manufacturer-retailer supply chain. We use an analytical model to investigate this issue. Our results show that although differentiated branding effectively alleviates channel competition and conflict, it is general not sufficient to achieve full channel coordination, and an additional coordination mechanism is necessary. The additional coordination mechanism we consider is profit sharing, using the Nash bargaining model. Based on our results, we derive optimal market strategies and identify probable paths for future research.     

A comparative analysis of greening policies across supply chain structures

In this paper, we examine an apparel serial supply chain whose players initiate product “greening.” We consider situations in which the players cooperate or act individually. Our problem is motivated by recent developments in the supply chains of global apparel players. We build game theoretic models and show how greening levels, prices and profits are influenced by channel structures. We also study the impact of greening costs and consumer sensitivity towards green apparels. We propose a two-part tariff contract to coordinate the green channel. Our key contribution lies in the model of decision making of various supply chain structures and analyzing its impact on the players and supply chain. The problem throws interesting insights into the strategies of apparel players and their key decisions.     

Channel coordination and transaction cost: A game-theoretic analysis

Traditional research identified equilibrium marketing channel coordination by using a classical demand function, and classical economic theory often ignored transaction costs. This paper develops a transaction cost linear demand function to investigate channel decision marking when transaction costs exist. Game theory is used to compare a non-cooperative equilibrium of a differential game played under Stackelberg strategies. By focusing on the effect of the distributor's transaction costs with respect to the marketing decision variables, especially the transaction cost and profit distribution, a fuller understanding of the entire decision structure is obtained. Some results are surprising, which set up the benchmark comparisons for future work in this area.     

Supply chain scheduling and coordination with dual delivery modes and inventory storage cost

We study a two-echelon supply chain scheduling problem in which a manufacturer acquires supplies from an upstream supplier and processes orders from the downstream retailers. The supply chain sells a single short-life product in a single season. We consider the scenario where the manufacturer can only accept some of the orders from the retailers due to its supplier's common production time window and its own two common production and delivery time windows. The upstream supplier processes materials and delivers the semi-finished products to the manufacturer within its time window. Then the manufacturer further processes these products to produce finished products and delivers them to the retailers within its two time windows, where one window is for production and normal delivery, and the other is for production and express delivery. Having to store the materials before processing them, the supplier incurs a storage cost, which depends on the order size and storage time. The manufacturer pays the transportation cost for delivering the finished products to the retailers. Due to double marginalization, the performance of the supply chain is sub-optimal. We model the supply chain problem as a flow shop scheduling problem with multiple common time windows. We derive some dominance properties and establish some theorems that help solve the sequencing problems for the orders and eliminate the idle time among the orders. Based on these results, we develop fast pseudo-polynomial dynamic algorithms to optimally solve the problem. We prove that the problem is NP-hard in the ordinary sense only. We develop two practically relevant and robust methods for the supply chain to achieve optimal profit-making performance through channel coordination.     

The relationship between buyer and a B2B e-marketplace: Cooperation determinants in an electronic market context

“Stop thinking like a supplier and start thinking as a customer.”

The authors argue that cooperation may be achieved by augmenting the core product with technology-based services. Given the growing importance of real time information exchange and interactivity, a better understanding of the use of technology to the establishment and development of the buyer-supplier cooperative relationships is essential for knowledge advancement. This paper argues that firms should aim to put themselves into their customers' shoes and use the “voice of the customer” to take their major relationship management decisions. To do so, the authors use a sample of nearly 400 SMEs' purchasing managers, to better understand cooperation determinants from the buyers' perspective. The study reveals that in an electronic marketplace, cooperation is positively affected by termination costs, supplier relationship policies and practices, communication and information exchange, and negatively affected by product prices and opportunistic behavior. Moreover, both relationship commitment and trust play a major role in mediating the relationships between these five determinants and cooperation. Surprisingly, resources relationship benefits do not show a significant impact on either commitment or cooperation. Theoretical and managerial implications of these findings are discussed.     

Sustainable fashion supply chain management under oligopolistic competition and brand differentiation

In this paper, we developed a new model of oligopolistic competition for fashion supply chains in the case of differentiated products with the inclusion of environmental concerns. The model assumes that each fashion firm's product is distinct by brand and the firms compete until an equilibrium is achieved. Each fashion firm seeks to maximize its profits as well as to minimize its emissions throughout its supply chain with the latter criterion being weighted in an individual manner by each firm. The competitive supply chain model is network-based and variational inequality theory is utilized for the formulation of the governing Nash equilibrium as well as for the solution of the case study examples. The numerical examples illustrate both the generality of the modeling framework as well as how the model and computational scheme can be used in practice to explore the effects of changes in the demand functions; in the total cost and total emission functions, as well as in the weights.     

Competitive pricing decisions in a two-echelon supply chain with horizontal and vertical competition

This study investigates the pricing decisions in a non-cooperative supply chain that consists of two retailers and one common supplier. The retailers order from the common supplier and compete in the same market. We analyze six power structures that characterize exclusively horizontal competition between the retailers and vertical competition between the supplier and the retailers, leading to different sequences of moves among the chain members. We derive the analytical forms of the equilibrium quantities under each power structure and explore the effect of retail substitutability on the equilibrium quantities among all power structures. We further investigate the performances of the game models as compared with the integrated model.     

Trust, power and transaction costs in B2B exchanges — A socio-economic approach

The advent of the Internet has enabled organisations to reconfigure their inter-organisational relationships. This study presents three frameworks to analyse the outcome that the use of Internet based electronic markets has on the nature of inter-organisational relationships: transaction cost economics, social exchange theory and an integrated framework that combines the first two. The integrated framework proposes that the nature of inter-organisational relationships depends on the interaction between the logic of transaction cost economics and the need for trust and interdependencies between exchange parties. A single case study is used to illustrate the way the three frameworks can be applied to analyse the use of electronic markets in inter-organisational exchanges. The study finds that the integrated framework provides a more complete understanding of inter-organisational relationships, and suggests a modular approach to the implementation of electronic marketplaces.     

The B2B-RELPERF scale and scorecard: Bringing relationship marketing theory into business-to-business practice

It is becoming increasingly important from both theoretical and managerial perspectives to measure Customer Relationship Management (CRM) as a key intangible asset. This paper seeks to bring relationship marketing theory into practice by developing a new measure of relationship performance between two firms, the business-to-business relationship performance (B2B-RELPERF) scale. Survey findings from a sample of approximately 400 purchasing managers operating in a B2B e-marketplace reveal that relationship performance is a high-order concept, composed of several distinct, yet related, dimensions: (1) relationship policies and practices, (2) relationship commitment; (3) trust in the relationship, (4) mutual cooperation; and (5) relationship satisfaction. Findings reveal that the B2B-RELPERF scale relates positively and significantly with customer loyalty. The paper also presents the B2B-RELPERF balanced scorecard, which combines tangible and intangible metrics. While existing IT solutions usually focus exclusively on the use of tangible CRM indicators, this new tool includes the “voice of the customer”. At the managerial level, both the scale and scorecard could act as useful instruments for short- and long-term management, controlling, planning, and improvement of B2B relationships. Implications for relationship marketing theory are also presented.