 Flexible procurement contracts for competing retailersJen-Yi Chen, Maqbool Dada and Hu, Qiaohai (Joice) European Journal of Operational Research, 2017, vol. 259, issue 1, 130-142 Abstract: We consider a manufacturer that offers one or both retailers opportunities to purchase in advance before uncertainty in market size is resolved. When the retailers order in advance, they may order simultaneously, or only one of them may order. Upon receiving orders, the manufacturer produces and delivers them. After uncertainty is resolved, the retailers may trade stock with each other. In addition, they may purchase more from the manufacturer. We identify sufficient conditions for the existence of pure-strategy equilibria and obtain sufficient conditions for advance stage procurement and recourse stage trading to occur. These structural properties are used in a numerical study that sheds insights into the manufacturer’s and retailers’ procurement contract design preferences and how these preferences are affected by production cost structure and demand variability. Keywords: Supply chain management; Game theory; Inventory; Pricing (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ejores:v:259:y:2017:i:1:p:130-142 DOI: 10.1016/j.ejor.2016.09.058 Access Statistics for this article European Journal of Operational Research is currently edited by Roman Slowinski, Jesus Artalejo, Jean-Charles. Billaut, Robert Dyson and Lorenzo Peccati More articles in European Journal of Operational Research from Elsevier |
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