In practice, capital‐constrained third‐party logistics (3PL) firms usually obtain bank financing (BF) to invest in logistics technology to enhance the consumer shopping experience. The emergence of financial innovation has prompted the adoption of alternative financing modes by 3PLs, including e‐commerce platform financing (EPF) and fourth‐party logistics financing (4PF). To clarify the differences among the three financing modes at the operational management level, we develop a Stackelberg game model to capture the strategic interactions between the 3PL and creditors. We examine a platform‐based supply chain where a manufacturer sells products through an e‐commerce platform to consumers, with the logistics services for the supply chain provided by the 3PL and fourth‐party logistics (4PL) firms. The analysis results reveal that the equilibrium interest rates under EPF and 4PF share a similar pattern regarding the logistics service cost coefficient, the commission rate, and the 4PL service fee. The difference is that under EPF (4PF), the logistics service level increases in the commission rate (4PL service fee) but decreases under the other financing strategy. Furthermore, the 3PL is inclined to invest in logistics technology only when the fixed investment cost is low, and these financing modes are complementary rather than alternative. The 3PL and manufacturer can benefit from 4PF (BF) when the logistics service cost coefficient is large and the market size is small (large); otherwise, EPF can enhance their profits. We also find that when the opportunity costs of capital are homogeneous, both the 4PL and the platform are consistently willing to act as financiers themselves. However, when considering heterogeneity in the opportunity costs of capital, they may be reluctant to provide financing. Each financing mode may achieve Pareto improvements under specific conditions. Finally, we also analyze the impact of technology R&D risks and endogenous 4PL service fee, yielding some valuable insights.
{"title":"Third‐party logistics firm's technology investment and financing options in platform‐based supply chain with 4PL service","authors":"Gongbing Bi, Fuli Shen, Yang Xu","doi":"10.1002/nav.22177","DOIUrl":"https://doi.org/10.1002/nav.22177","url":null,"abstract":"In practice, capital‐constrained third‐party logistics (3PL) firms usually obtain bank financing (BF) to invest in logistics technology to enhance the consumer shopping experience. The emergence of financial innovation has prompted the adoption of alternative financing modes by 3PLs, including e‐commerce platform financing (EPF) and fourth‐party logistics financing (4PF). To clarify the differences among the three financing modes at the operational management level, we develop a Stackelberg game model to capture the strategic interactions between the 3PL and creditors. We examine a platform‐based supply chain where a manufacturer sells products through an e‐commerce platform to consumers, with the logistics services for the supply chain provided by the 3PL and fourth‐party logistics (4PL) firms. The analysis results reveal that the equilibrium interest rates under EPF and 4PF share a similar pattern regarding the logistics service cost coefficient, the commission rate, and the 4PL service fee. The difference is that under EPF (4PF), the logistics service level increases in the commission rate (4PL service fee) but decreases under the other financing strategy. Furthermore, the 3PL is inclined to invest in logistics technology only when the fixed investment cost is low, and these financing modes are complementary rather than alternative. The 3PL and manufacturer can benefit from 4PF (BF) when the logistics service cost coefficient is large and the market size is small (large); otherwise, EPF can enhance their profits. We also find that when the opportunity costs of capital are homogeneous, both the 4PL and the platform are consistently willing to act as financiers themselves. However, when considering heterogeneity in the opportunity costs of capital, they may be reluctant to provide financing. Each financing mode may achieve Pareto improvements under specific conditions. Finally, we also analyze the impact of technology R&D risks and endogenous 4PL service fee, yielding some valuable insights.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-02-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139951578","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In the platform economy era, e-commerce platforms function as distribution channels for sellers and offer online loans to sellers as financing providers. This study focuses on platform finance, where the platform sets a credit line or interest rate to offer either a limited or unlimited loan to capital-constrained sellers. The sellers may have sufficient initial capital or be capital-constrained but have access to limited or unlimited loans. We found that the optimal sellers' channel strategy, choosing either a single channel or online-dominant or offline-dominant dual channels, depends on the platform's credit line, consumers' channel preferences, and their switching behavior between online and offline channels. Given an unlimited (or limited) loan, the seller's dominated channel's quantity decreases (or increases) with her initial capital. The seller's and platform's preference for the unlimited loan or limited loan depends on the dominant channel and the seller's capital constraint. Loan offerings result in Pareto improvements for both participants, which reveals the value platform finance brings. We compare platform finance with bank finance and find that platform finance increases the sellers' threshold quantity without stockout in each channel and encourages the seller to place a higher quantity in both channels. We also examine the channel substitution effect on the sellers' quantity decisions. Findings provide insights for platforms and sellers to implement optimal financing and channel structures to increase their profits.
{"title":"E-commerce platform finance with dual channels","authors":"Nina Yan, Zhineng Chen, Xun Xu, Xiuli He","doi":"10.1002/nav.22176","DOIUrl":"https://doi.org/10.1002/nav.22176","url":null,"abstract":"In the platform economy era, e-commerce platforms function as distribution channels for sellers and offer online loans to sellers as financing providers. This study focuses on platform finance, where the platform sets a credit line or interest rate to offer either a limited or unlimited loan to capital-constrained sellers. The sellers may have sufficient initial capital or be capital-constrained but have access to limited or unlimited loans. We found that the optimal sellers' channel strategy, choosing either a single channel or online-dominant or offline-dominant dual channels, depends on the platform's credit line, consumers' channel preferences, and their switching behavior between online and offline channels. Given an unlimited (or limited) loan, the seller's dominated channel's quantity decreases (or increases) with her initial capital. The seller's and platform's preference for the unlimited loan or limited loan depends on the dominant channel and the seller's capital constraint. Loan offerings result in Pareto improvements for both participants, which reveals the value platform finance brings. We compare platform finance with bank finance and find that platform finance increases the sellers' threshold quantity without stockout in each channel and encourages the seller to place a higher quantity in both channels. We also examine the channel substitution effect on the sellers' quantity decisions. Findings provide insights for platforms and sellers to implement optimal financing and channel structures to increase their profits.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-02-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139918560","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The geometric process has been widely studied in various disciplines and applied in reliability, maintenance and warranty cost analysis, among others. In its applications in maintenance policy optimisation, the geometric process assumes constant repair effectiveness by its process rate. Nevertheless, in practice, maintenance effectiveness may differ from time to time and can therefore be better depicted by a random variable. Motivated by this argument, this paper proposes a new variant of the geometric process, which is referred to as the rate randomized geometric process (RRGP). The probabilistic properties of the RRGP are then investigated. The maximum likelihood method is utilised to estimate the parameters of the RRGP. Numerical examples are given to show its applicability in both maintenance policy optimization and fitting real-world failure datasets.
{"title":"A rate randomized geometric process with applications","authors":"Majid Asadi, Shaomin Wu","doi":"10.1002/nav.22175","DOIUrl":"https://doi.org/10.1002/nav.22175","url":null,"abstract":"The geometric process has been widely studied in various disciplines and applied in reliability, maintenance and warranty cost analysis, among others. In its applications in maintenance policy optimisation, the geometric process assumes constant repair effectiveness by its process rate. Nevertheless, in practice, maintenance effectiveness may differ from time to time and can therefore be better depicted by a random variable. Motivated by this argument, this paper proposes a new variant of the geometric process, which is referred to as the rate randomized geometric process (RRGP). The probabilistic properties of the RRGP are then investigated. The maximum likelihood method is utilised to estimate the parameters of the RRGP. Numerical examples are given to show its applicability in both maintenance policy optimization and fitting real-world failure datasets.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-02-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139758826","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Lotte van Aken, Loe Schlicher, Marco Slikker, Geert-Jan van Houtum
In light of recent terrorist attacks, we introduce and study a Stackelberg game between a government and a terrorist. In this game, the government positions a number of heavily-armed rapid response teams on a line segment (e.g., a long boulevard or shopping avenue) and then the terrorist attacks a location with the highest potential impact of an attack. This potential impact, which we call damage, is the product of the time it takes the closest rapid response team to react and the damage caused per time unit, which is modeled via a damage rate function. We prove that there exists a subgame perfect Nash equilibrium that balances the possible damage on all intervals of the line segment that result from positioning the rapid response teams. We discuss the implications for various types of damage rate functions including one mimicking a busy boulevard with various hotspot locations.
{"title":"Fighting terrorism: How to position rapid response teams?","authors":"Lotte van Aken, Loe Schlicher, Marco Slikker, Geert-Jan van Houtum","doi":"10.1002/nav.22170","DOIUrl":"https://doi.org/10.1002/nav.22170","url":null,"abstract":"In light of recent terrorist attacks, we introduce and study a Stackelberg game between a government and a terrorist. In this game, the government positions a number of heavily-armed rapid response teams on a line segment (e.g., a long boulevard or shopping avenue) and then the terrorist attacks a location with the highest potential impact of an attack. This potential impact, which we call damage, is the product of the time it takes the closest rapid response team to react and the damage caused per time unit, which is modeled via a damage rate function. We prove that there exists a subgame perfect Nash equilibrium that balances the possible damage on all intervals of the line segment that result from positioning the rapid response teams. We discuss the implications for various types of damage rate functions including one mimicking a busy boulevard with various hotspot locations.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-02-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139758845","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Recent years have witnessed e-commerce platforms that voluntarily invest in new digital technologies to help their suppliers reduce production costs. To examine its impact on channel structure, we develop a supply chain model consisting of a supplier and an e-commerce platform who purchases products from the supplier at a wholesale price and sells them to end markets. In addition, the supplier has the option to accept the marketplace by paying a commission fee charged by the platform. We show that the presence of voluntary investment on production improvement can overturn some classical insights from prior studies. For example, a higher marketplace commission fee can lead to a lower selling quantity in the marketplace, but a higher order quantity in the reselling channel under certain conditions. This stands in strict contrast to the opposite finding when the platform invests instead on demand enhancement. In addition, previous studies suggest that offering the supplier the marketplace option is beneficial to the supplier but is detrimental to the platform. However, with voluntary investment, the platform can benefit from allowing the supplier to encroach via the marketplace, and in some situations the supplier suffers from having such an option. We find that the commission fee and the production cost are two interacting forces steering equilibrium decisions for supply chain members, and we characterize the concise operating regimes for the channel structure choices on behalves of the supplier and the platform. A number of extensions are discussed, including product substitution level, investment cost structure, whether the quantity decisions are made simultaneously or sequentially, voluntary investment timing, and endogenous commission fee.
{"title":"Reselling or dual selling? The role of consumer-to-manufacturer e-commerce platforms' voluntary investment","authors":"You Zhao, Rui Hou, Ying-Ju Chen","doi":"10.1002/nav.22173","DOIUrl":"https://doi.org/10.1002/nav.22173","url":null,"abstract":"Recent years have witnessed e-commerce platforms that voluntarily invest in new digital technologies to help their suppliers reduce production costs. To examine its impact on channel structure, we develop a supply chain model consisting of a supplier and an e-commerce platform who purchases products from the supplier at a wholesale price and sells them to end markets. In addition, the supplier has the option to accept the marketplace by paying a commission fee charged by the platform. We show that the presence of voluntary investment on production improvement can overturn some classical insights from prior studies. For example, a higher marketplace commission fee can lead to a lower selling quantity in the marketplace, but a higher order quantity in the reselling channel under certain conditions. This stands in strict contrast to the opposite finding when the platform invests instead on demand enhancement. In addition, previous studies suggest that offering the supplier the marketplace option is beneficial to the supplier but is detrimental to the platform. However, with voluntary investment, the platform can benefit from allowing the supplier to encroach via the marketplace, and in some situations the supplier suffers from having such an option. We find that the commission fee and the production cost are two interacting forces steering equilibrium decisions for supply chain members, and we characterize the concise operating regimes for the channel structure choices on behalves of the supplier and the platform. A number of extensions are discussed, including product substitution level, investment cost structure, whether the quantity decisions are made simultaneously or sequentially, voluntary investment timing, and endogenous commission fee.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-02-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139758842","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This work develops a Cournot game model to study two competing supply chains, each consisting of one manufacturer and one supplier, producing and selling substitutable green products. The manufacturers decide whether to adopt the green supplier integration (GSI) strategy and the green supplier development (GSD) investment level to improve the product greenness degree. The interaction between the GSD decisions and the GSI strategies are analyzed with different manufacturer GSD capacities and market greenness sensitivity. The results indicate that the manufacturer with a higher GSD capacity will always adopt the GSI strategy to maximize GSD investment level or profit, and the manufacturer with a lower GSD capacity decides whether to adopt the GSI strategy by comparing the GSD capacities of the two manufacturers. The game model is extended from dedicated sourcing to diversified sourcing and hybrid sourcing to obtain optimal sourcing options jointly reached by the two manufacturers. Under these extensions, the GSI strategy always leads to higher GSD investment levels, and adopting the GSI strategies by both manufacturers becomes the only Nash equilibrium strategy combination. Manufacturers choose different sourcing options by judging the difference in their GSD capacities under different criteria, and choose hybrid sourcing when their GSD capacity gap is sufficiently large in a weakly competitive market.
{"title":"Effects of green supplier integration and development in competing supply chains","authors":"Yu Guo, Chunguang Bai, Minghe Sun","doi":"10.1002/nav.22174","DOIUrl":"https://doi.org/10.1002/nav.22174","url":null,"abstract":"This work develops a Cournot game model to study two competing supply chains, each consisting of one manufacturer and one supplier, producing and selling substitutable green products. The manufacturers decide whether to adopt the green supplier integration (GSI) strategy and the green supplier development (GSD) investment level to improve the product greenness degree. The interaction between the GSD decisions and the GSI strategies are analyzed with different manufacturer GSD capacities and market greenness sensitivity. The results indicate that the manufacturer with a higher GSD capacity will always adopt the GSI strategy to maximize GSD investment level or profit, and the manufacturer with a lower GSD capacity decides whether to adopt the GSI strategy by comparing the GSD capacities of the two manufacturers. The game model is extended from dedicated sourcing to diversified sourcing and hybrid sourcing to obtain optimal sourcing options jointly reached by the two manufacturers. Under these extensions, the GSI strategy always leads to higher GSD investment levels, and adopting the GSI strategies by both manufacturers becomes the only Nash equilibrium strategy combination. Manufacturers choose different sourcing options by judging the difference in their GSD capacities under different criteria, and choose hybrid sourcing when their GSD capacity gap is sufficiently large in a weakly competitive market.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-02-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139758736","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We consider a supply chain in which a buyer sources from a supplier for the production of a product. The supplier's production process is subject to probable violations of either government regulations or ethical requirements. The sourcing contract offered by the buyer demands that the supplier exerts an effort to improve its production process, thus reducing the probability of the occurrence of supplier violation. Because the supplier's effort is hardly observable, the buyer has to send an auditor to perform an audit of the supplier's facility. The auditor in turn reports whether the supplier has exerted the effort or not. If the supplier fails to pass the audit, she may offer a side contract to the auditor, thus engaging in a supplier-auditor collusion. We study how such supplier–auditor collusion may affect the buyer's outsourcing strategy. We find that the buyer should reduce the order quantity to deter the supplier–auditor collusion when the collusion penalty is relatively low. We further examine reaudit and dual sourcing, two mechanisms which could probably prevent supplier–auditor collusion. We find that a reaudit may complement the collusion penalty under certain conditions; using dual sourcing to deter collusion is viable only if supplier-improvement techniques or procedures are effective. Finally, we extend our model by considering false positive audit error and linear penalty function. Our analytical and numerical results show that our insights are robust.
{"title":"Reauditing and dual sourcing? Implication of collusion deterrence measures in ethical sourcing","authors":"Jiahui Zhou, Shiqing Yao, Kaijie Zhu","doi":"10.1002/nav.22172","DOIUrl":"https://doi.org/10.1002/nav.22172","url":null,"abstract":"We consider a supply chain in which a buyer sources from a supplier for the production of a product. The supplier's production process is subject to probable violations of either government regulations or ethical requirements. The sourcing contract offered by the buyer demands that the supplier exerts an effort to improve its production process, thus reducing the probability of the occurrence of supplier violation. Because the supplier's effort is hardly observable, the buyer has to send an auditor to perform an audit of the supplier's facility. The auditor in turn reports whether the supplier has exerted the effort or not. If the supplier fails to pass the audit, she may offer a side contract to the auditor, thus engaging in a supplier-auditor collusion. We study how such supplier–auditor collusion may affect the buyer's outsourcing strategy. We find that the buyer should reduce the order quantity to deter the supplier–auditor collusion when the collusion penalty is relatively low. We further examine reaudit and dual sourcing, two mechanisms which could probably prevent supplier–auditor collusion. We find that a reaudit may complement the collusion penalty under certain conditions; using dual sourcing to deter collusion is viable only if supplier-improvement techniques or procedures are effective. Finally, we extend our model by considering false positive audit error and linear penalty function. Our analytical and numerical results show that our insights are robust.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-01-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139374382","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Jorge Navarro, Antonio Arriaza, Alfonso Suárez-Llorens
The article is focused on studying how to predict the failure times of coherent systems from the early failure times of their components. Both the cases of independent and dependent components are considered by assuming that they are identically distributed (homogeneous components). The heterogeneous components' case can be addressed similarly but more complexly. The present study is for non-repairable systems, but the information obtained could be used to decide if a maintenance action should be carried out at time . Different cases are considered regarding the information available at time . We use quantile regression techniques to predict the system failure times and to provide prediction intervals. The theoretical results are applied to specific system structures in some illustrative examples.
文章的重点是研究如何从组件的早期失效时间预测连贯系统的失效时间。通过假设独立组件和从属组件是同分布的（同质组件），考虑了这两种情况。异质组件的情况也可以类似处理，但更为复杂。本研究针对的是不可修复的系统，但所获得的信息可用于决定是否应在 t$$ t $$ 时间采取维护行动。我们考虑了时间 t$$ t $$ 可用信息的不同情况。我们使用量子回归技术来预测系统故障时间，并提供预测区间。在一些示例中，我们将理论结果应用于特定的系统结构。
{"title":"Predicting failure times of coherent systems","authors":"Jorge Navarro, Antonio Arriaza, Alfonso Suárez-Llorens","doi":"10.1002/nav.22169","DOIUrl":"https://doi.org/10.1002/nav.22169","url":null,"abstract":"The article is focused on studying how to predict the failure times of coherent systems from the early failure times of their components. Both the cases of independent and dependent components are considered by assuming that they are identically distributed (homogeneous components). The heterogeneous components' case can be addressed similarly but more complexly. The present study is for non-repairable systems, but the information obtained could be used to decide if a maintenance action should be carried out at time <math altimg=\"urn:x-wiley:nav:media:nav22169:nav22169-math-0001\" display=\"inline\" location=\"graphic/nav22169-math-0001.png\" overflow=\"scroll\">\u0000<semantics>\u0000<mrow>\u0000<mi>t</mi>\u0000</mrow>\u0000$$ t $$</annotation>\u0000</semantics></math>. Different cases are considered regarding the information available at time <math altimg=\"urn:x-wiley:nav:media:nav22169:nav22169-math-0002\" display=\"inline\" location=\"graphic/nav22169-math-0002.png\" overflow=\"scroll\">\u0000<semantics>\u0000<mrow>\u0000<mi>t</mi>\u0000</mrow>\u0000$$ t $$</annotation>\u0000</semantics></math>. We use quantile regression techniques to predict the system failure times and to provide prediction intervals. The theoretical results are applied to specific system structures in some illustrative examples.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-01-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139374535","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
To encourage consumers to reuse their used products, some manufacturers launch second-hand platforms while others adopt sharing platforms. Which platform benefits them more is an interesting problem for such manufacturers. To address this problem, we propose a two-period model in which heterogeneous consumers decide whether to buy new products in Period 1 or to rent (buy) used products on the platform in Period 2. Under a proportional transaction fee, we show that the two platforms can benefit the manufacturer if the unit production cost is high, and the valuation difference is low or the number of high-value consumers in Period 1 is fewer than in Period 2. Moreover, the two platforms are equivalent when the salvage value is 0. When the salvage value is positive, the second-hand platform benefits the manufacturer more than the sharing platform. The sharing platform induces the manufacturer to set a higher sale price than the second-hand platform when the unit production cost is high and there are fewer high-value consumers in Period 1. Otherwise, the sale and reselling prices are higher under the second-hand platform. We also consider the cases with a general consumer valuation distribution, multiple product life cycles, and a fixed transaction fee. Our findings can help manufacturers make the decision on platform choice to handle used products.
{"title":"Sharing or reselling? How does manufacturer handle used products?","authors":"Mengnan Wang, Juliang Zhang, T. C. E. Cheng","doi":"10.1002/nav.22171","DOIUrl":"https://doi.org/10.1002/nav.22171","url":null,"abstract":"To encourage consumers to reuse their used products, some manufacturers launch second-hand platforms while others adopt sharing platforms. Which platform benefits them more is an interesting problem for such manufacturers. To address this problem, we propose a two-period model in which heterogeneous consumers decide whether to buy new products in Period 1 or to rent (buy) used products on the platform in Period 2. Under a proportional transaction fee, we show that the two platforms can benefit the manufacturer if the unit production cost is high, and the valuation difference is low or the number of high-value consumers in Period 1 is fewer than in Period 2. Moreover, the two platforms are equivalent when the salvage value is 0. When the salvage value is positive, the second-hand platform benefits the manufacturer more than the sharing platform. The sharing platform induces the manufacturer to set a higher sale price than the second-hand platform when the unit production cost is high and there are fewer high-value consumers in Period 1. Otherwise, the sale and reselling prices are higher under the second-hand platform. We also consider the cases with a general consumer valuation distribution, multiple product life cycles, and a fixed transaction fee. Our findings can help manufacturers make the decision on platform choice to handle used products.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2024-01-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139374690","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article investigates the impact of demand uncertainty on online retailers' store branding partnerships with manufacturers. The study examines whether such partnerships, involving service effort to boost demand, are effective under uncertain conditions. The supply chain comprises an intermediary and a manufacturer, with the manufacturer facing a service cost disadvantage. The benchmark case is the manufacturer's sale through the agency (AG) contract with the intermediary. Using a two-period game-theoretic model, the study analyzes equilibrium prices, service efforts, and profits for the AG contract and two store branding contracts: original design manufacturer (ODM) and acquisition (AC). Findings show that the intermediary adopts store branding when its service cost advantage is significant. The intermediary exhibits a preference for the ODM contract when the commission fee falls within a moderate range. Conversely, when it deviates from this middle ground, the AC contract becomes more favorable. Within the AC contract framework, with low commission fees, specifically when the service cost advantage is not particularly pronounced and demand variability is high, the intermediary opts to trigger the acquisition option exclusively when the actual demand turns out to be substantial. With high commission fees, the intermediary avoids the acquisition option. These outcomes arise from balancing the double marginalization effect caused by factors like service cost advantage, service decentralization, and wholesale price. Implementing store branding through ODM or AC contracts enhances supply chain profit when it is optimal for the intermediary. We provide insights into online retailers' decision-making regarding store branding partnerships with manufacturers under demand uncertainty. It highlights the importance of considering factors like service cost advantage, service decentralization, and wholesale prices to determine the optimal store branding strategy. The research contributes to understanding supply chain dynamics and suggests ways to enhance supply chain profit in online retail.
{"title":"Strategic contract selection of an online retailer when implementing store branding","authors":"Mingyou Meng, Shiming Deng, He Xu, Stuart X. Zhu","doi":"10.1002/nav.22168","DOIUrl":"https://doi.org/10.1002/nav.22168","url":null,"abstract":"This article investigates the impact of demand uncertainty on online retailers' store branding partnerships with manufacturers. The study examines whether such partnerships, involving service effort to boost demand, are effective under uncertain conditions. The supply chain comprises an intermediary and a manufacturer, with the manufacturer facing a service cost disadvantage. The benchmark case is the manufacturer's sale through the agency (AG) contract with the intermediary. Using a two-period game-theoretic model, the study analyzes equilibrium prices, service efforts, and profits for the AG contract and two store branding contracts: original design manufacturer (ODM) and acquisition (AC). Findings show that the intermediary adopts store branding when its service cost advantage is significant. The intermediary exhibits a preference for the ODM contract when the commission fee falls within a moderate range. Conversely, when it deviates from this middle ground, the AC contract becomes more favorable. Within the AC contract framework, with low commission fees, specifically when the service cost advantage is not particularly pronounced and demand variability is high, the intermediary opts to trigger the acquisition option exclusively when the actual demand turns out to be substantial. With high commission fees, the intermediary avoids the acquisition option. These outcomes arise from balancing the double marginalization effect caused by factors like service cost advantage, service decentralization, and wholesale price. Implementing store branding through ODM or AC contracts enhances supply chain profit when it is optimal for the intermediary. We provide insights into online retailers' decision-making regarding store branding partnerships with manufacturers under demand uncertainty. It highlights the importance of considering factors like service cost advantage, service decentralization, and wholesale prices to determine the optimal store branding strategy. The research contributes to understanding supply chain dynamics and suggests ways to enhance supply chain profit in online retail.","PeriodicalId":49772,"journal":{"name":"Naval Research Logistics","volume":null,"pages":null},"PeriodicalIF":2.3,"publicationDate":"2023-12-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138627899","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
京公网安备 11010802042870号
京ICP备2023020795号-1
扫码关注我们
求助内容：
应助结果提醒方式：