{"title":"Sourcing strategies for competing manufacturers in the toy industry","authors":"Peiyi Liang, Feng Yang, Feifei Shan","doi":"10.1108/jm2-03-2023-0059","DOIUrl":null,"url":null,"abstract":"Purpose This paper aims to examine the optimal sourcing strategies and pricing decisions of competing toy manufacturers and to discuss how manufacturers’ decisions are impacted by competition. Design/methodology/approach The authors consider a single-period model to characterise the competition between two competing toy manufacturers. Both of them are free to choose between virgin material and recycled material. The authors consider two types of consumers: sensitive consumers who are concerned about product safety and prefer the toy made of virgin material and insensitive consumers who do not care what material is used in the toy. The competing manufacturers play a Cournot competition. Findings The results reveal a special case of a win-win situation for both the manufacturer and the consumer. In addition, an increasing number of sensitive consumers does not always raise the price of virgin-material toys. Practical implications The authors derive the manufacturer’s equilibrium sourcing strategies, corresponding market-clearing prices and profits obtained. Originality/value The paper investigates how toy manufacturers’ optimal sourcing strategies are impacted by competition, considering market segments.","PeriodicalId":16349,"journal":{"name":"Journal of Modelling in Management","volume":null,"pages":null},"PeriodicalIF":1.8000,"publicationDate":"2023-09-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Modelling in Management","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1108/jm2-03-2023-0059","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"MANAGEMENT","Score":null,"Total":0}
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Abstract
Purpose This paper aims to examine the optimal sourcing strategies and pricing decisions of competing toy manufacturers and to discuss how manufacturers’ decisions are impacted by competition. Design/methodology/approach The authors consider a single-period model to characterise the competition between two competing toy manufacturers. Both of them are free to choose between virgin material and recycled material. The authors consider two types of consumers: sensitive consumers who are concerned about product safety and prefer the toy made of virgin material and insensitive consumers who do not care what material is used in the toy. The competing manufacturers play a Cournot competition. Findings The results reveal a special case of a win-win situation for both the manufacturer and the consumer. In addition, an increasing number of sensitive consumers does not always raise the price of virgin-material toys. Practical implications The authors derive the manufacturer’s equilibrium sourcing strategies, corresponding market-clearing prices and profits obtained. Originality/value The paper investigates how toy manufacturers’ optimal sourcing strategies are impacted by competition, considering market segments.
期刊介绍：
Journal of Modelling in Management (JM2) provides a forum for academics and researchers with a strong interest in business and management modelling. The journal analyses the conceptual antecedents and theoretical underpinnings leading to research modelling processes which derive useful consequences in terms of management science, business and management implementation and applications. JM2 is focused on the utilization of management data, which is amenable to research modelling processes, and welcomes academic papers that not only encompass the whole research process (from conceptualization to managerial implications) but also make explicit the individual links between ''antecedents and modelling'' (how to tackle certain problems) and ''modelling and consequences'' (how to apply the models and draw appropriate conclusions). The journal is particularly interested in innovative methodological and statistical modelling processes and those models that result in clear and justified managerial decisions. JM2 specifically promotes and supports research writing, that engages in an academically rigorous manner, in areas related to research modelling such as: A priori theorizing conceptual models, Artificial intelligence, machine learning, Association rule mining, clustering, feature selection, Business analytics: Descriptive, Predictive, and Prescriptive Analytics, Causal analytics: structural equation modeling, partial least squares modeling, Computable general equilibrium models, Computer-based models, Data mining, data analytics with big data, Decision support systems and business intelligence, Econometric models, Fuzzy logic modeling, Generalized linear models, Multi-attribute decision-making models, Non-linear models, Optimization, Simulation models, Statistical decision models, Statistical inference making and probabilistic modeling, Text mining, web mining, and visual analytics, Uncertainty-based reasoning models.
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