 Price, capacity, and lead-time decisions for a make-to-order supply chain with two production modesTiaojun Xiao and Jing Shi International Journal of Applied Management Science, 2012, vol. 4, issue 2, 107-129 Abstract: This paper considers a supply chain consisting of one make-to-order (MTO) manufacturer and one retailer in a price and lead-time sensitive market. We develop a manufacturer-Stackelberg (MS) model with exogenous lead-time standard and a MS model with endogenous lead-time standard. We find that the endogenisation of the lead-time standard for the faster product may change the monotonicity of the equilibrium capacity for the faster product in the lead-time sensitivity and the cross effect of lead-time; and change the monotonicity of the price difference between the two products in the cross effect. We also consider a retailer-Stackelberg (RS) model to examine the effect of market power on equilibrium outcome. We find that: 1) the higher market power for the retailer expands demand rate differentiation as well as capacity differentiation between the two products; 2) the manufacturer has a lower incentive to differentiate its products under RS than under MS. Keywords: capacity; game theory; lead times; product differentiation; supply chain management; SCM; management science; make-to-order; MTO; price difference; Stackelberg; modelling. (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:ids:injams:v:4:y:2012:i:2:p:107-129 Access Statistics for this article More articles in International Journal of Applied Management Science from Inderscience Enterprises Ltd |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.