Collaboration for a two-echelon supply chain in the pulp and paper industry: the use of incentives to increase profit

N Lehoux (), S D'Amours, Y Frein, A Langevin and B Penz
Additional contact information
N Lehoux: FORAC, Université Laval
S D'Amours: FORAC, Université Laval
Y Frein: Laboratoire G-SCOP INPG-CNRS-UJF
A Langevin: CIRRELT, École Polytechnique de Montréal
B Penz: Laboratoire G-SCOP INPG-CNRS-UJF

Journal of the Operational Research Society, 2011, vol. 62, issue 4, 581-592

Abstract: Abstract In our research, we study the case of a pulp and paper producer who decides to establish a partnership with one buyer. Using two different types of relationship, namely a traditional system without any collaboration scheme and Collaborative Planning, Forecasting and Replenishment, we develop decision models describing the producer and the buyer planning processes. We also identify which approach is more profitable for each actor as well as for the network, based on real costs and parameters obtained from the industrial case. We then test how different incentives can improve the traditional system and provide higher gains for each partner. Our results show that using incentives increases the system's profit by up to 4% if parameters are well defined.

Keywords: logistics; linear programming; forestry; enterprise collaboration (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (7)

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DOI: 10.1057/jors.2009.167

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