Cooperation among competitors: A comparison of cost-sharing mechanisms

Roma, Paolo; Perrone, Giovanni

doi:10.1016/j.ijpe.2016.08.002

Cited by 23 publications

(7 citation statements)

References 39 publications

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“…This would also encourage more inter-modal transport on the last mile, as argued for long-distance transport in Colicchia et al (2017). In addition, concepts of synchromodality can be considered as presented in Dong et al (2016), potentially letting coalition partners share the cost of the resulting required investments as theoretically analyzed in Roma and Perrone (2016).…”

Section: Strategic Planningmentioning

confidence: 99%

Collaborative urban transportation: Recent advances in theory and practice

Cleophas

Cottrill

Ehmke

et al. 2019

European Journal of Operational Research

252

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This is a PDF file of an unedited manuscript that has been accepted for publication. As a service to our customers we are providing this early version of the manuscript. The manuscript will undergo copyediting, typesetting, and review of the resulting proof before it is published in its final form. Please note that during the production process errors may be discovered which could affect the content, and all legal disclaimers that apply to the journal pertain. Highlights • Comprehensive overview of OR approaches for collaborative urban transportation • Analyzes real-world collaborative transportation systems, assessing pros and cons • Research outlook for the emerging field of collaborative transport optimization

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Section: Strategic Planningmentioning

confidence: 99%

Collaborative urban transportation: Recent advances in theory and practice

Cleophas

Cottrill

Ehmke

et al. 2019

European Journal of Operational Research

252

View full text Add to dashboard Cite

show abstract

“…Ghosh and Shah [ 17 ] discuss SC coordination issues caused by the green SC initiatives and analyze the effort of the cost-sharing contract on the critical decisions of SC participants who implement green suggestions. Roma and Perrone [ 43 ] introduce outcome-based versus ex-ante-based cost-sharing contracts to study the impact of these two contracts on the profitability and total welfare of competing companies by constructing a game model. Liu et al [ 33 ] build a differential game framework and find that the retailer can effectively encourage the manufacturer to improve the green-degree of products by implementing a cost-sharing contract.…”

Section: Literature Reviewmentioning

confidence: 99%

E-commerce supply chain inventory decisions and contract design considering sales effort and risk aversion

Cai

Jia

Zhou

et al. 2022

Electron Commer Res

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We introduce vendor-managed inventory (VMI) modes and retailer-managed inventory modes and use conditional value-at-risk to quantify the inventory manager’s risk aversion. Then, we compare the supply chain (SC) members’ optimal decisions and expected utilities when the online retail platform or the supplier conducts sales effort under different inventory modes. The cost-sharing contracts are introduced to optimize the SC performance. Some interesting findings are achieved: for VMI SC, SC members’ sales-effort preferences change with the wholesale price; the inventory manager’s risk-aversion degree has a significant impact on the SC members’ preferences for inventory management modes; there always exists appropriate cost-sharing ratio regions in which the SC members’ expected utilities can be improved. The corresponding research results can help to improve the operational effectiveness of different kinds of SCs.

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“…Within a prespecified price window, the firm pays the realized price, but outside of that window the firm shares (in an agreed way) any added costs or benefits. This cost-sharing mechanism is widely used in the following types of business situations: collaborative shipping, scheduling, decentralized assembly SCs, vendor-managed inventory systems and cooperation among competitors (Tinoco et al, 2017;Balireddiab, 2012;Lenga, 2010;Lee et al, 2016;Roma and Perrone, 2016). The cost-sharing mechanism induced by the Shapley value minimizes the worst-case inefficiency of the equilibria in resource selection games, such as in routing traffic, coordinating telecommunication networks or acquiring goods and services with demand-dependent prices (Gkatzelis et al, 2016).…”

Section: The Supply Chain (Sc) Sharing Economymentioning

confidence: 99%

Joint optimal decision of the shared distribution system through revenue-sharing and cooperative investment contracts

Wei

Sheng

Gou

et al. 2019

IMDS

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Purpose The rapid development of e-commerce has caused not only explosive growth of the express delivery industry, but also ever-greater operational pressures. Models from the sharing economy may provide new ideas for operational improvement. The purpose of this paper is to consider an optimization method that reduces costs and increases efficiency. The proposed method enables a shared distribution system based on revenue-sharing and cooperative investment contracts. Design/methodology/approach The authors design a two-echelon supply chain (SC) of the shared distribution system with one shared distribution company and N express companies. In this SC, the express companies provide only inter-city transportation, and they outsource internal-city transportation to a shared distribution company. This distribution system differs from that of the traditional express delivery industry. The traditional system of delivery requires large numbers of empty trips (with no load to deliver), because the operating mode of urban distribution has been the franchise. To offer greater efficiency and performance, the authors introduce the sharing economy mode of express delivery. The authors examine the potential of a joint optimal decision-making strategy that involves revenue-sharing and cooperative investment contracts based on an order flow proportion (OFP) and a revenue-sharing factor (RSF). In this shared distribution system, the most important innovation is that all of the express companies jointly invest in and establish a shared distribution company based on OFP or RSF principles. Findings The profitability of an SC with revenue-sharing contracts based on an OFP system is much higher than that of a decentralized SC, and it is very close to the profitability of a centralized SC. In SCs with revenue-sharing contracts that are based on RSFs, there are many possible combinations of RSFs that can increase the overall profitability. The analyses indicate that the OFP system offers the best solution in designing revenue-sharing contracts based on RSFs. Practical implications This study indicates that revenue-sharing contracts based on both OFP and RSF principles can increase overall SC returns by 0.21 to 0.44 percent. In sum total, this improvement could mean a 0.84 to 1.76bn Yuan increase in revenues for the 400+ bn-Yuan express delivery industry. Originality/value The authors find that a combination of equity investment and SC coordination contracts makes the cooperation between SC members much more stable. Through this kind of shared distribution system, the scale of economy can further reduce the costs and increase the efficiency of the express delivery industry.

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Cooperation among competitors: A comparison of cost-sharing mechanisms

Cited by 23 publications

References 39 publications

Collaborative urban transportation: Recent advances in theory and practice

Collaborative urban transportation: Recent advances in theory and practice

E-commerce supply chain inventory decisions and contract design considering sales effort and risk aversion

Joint optimal decision of the shared distribution system through revenue-sharing and cooperative investment contracts

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