“Production + procurement” outsourcing with competitive contract manufacturer's partial learning and supplier's price discrimination

Niu, Baozhuang; Zeng, Fanzhuo; Chen, Lei

doi:10.1111/itor.12904

Cited by 15 publications

(14 citation statements)

References 43 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…(2018), and Niu et al. (2021). The innovation may be undertaken by the upstream firm or/and the downstream firm, and the investment may be incurred by a single firm or shared by both firms.…”

Section: Literature Reviewmentioning

confidence: 97%

“…There is a growing amount of literature on supply chain management that incorporates the decision on innovation. Innovation is extensively investigated in the supply chain, for example, Bellamy et al (2014), Sabri et al (2018), and Niu et al (2021). The innovation may be undertaken by the upstream firm or/and the downstream firm, and the investment may be incurred by a single firm or shared by both firms.…”

Section: Literature Reviewmentioning

confidence: 99%

See 1 more Smart Citation

Flexible versus committed and specific versus uniform: wholesale price contracting in a supply chain with downstream process innovation

Yan

Xiong

Lin

et al. 2022

Int Trans Operational Res

View full text Add to dashboard Cite

If buyers are asymmetric in terms of their operating costs, researchers and managers broadly agree that the supplier can optimize her/his own profit by offering the more efficient buyer a higher price. In this paper, we develop a game theoretical model to investigate the interaction between one supplier and two asymmetric buyers within a supply chain. We formulate buyers' operating costs as a function of their process innovation levels, which implies that they can reduce the unit operating cost via investments in process innovation in the long run. Our research demonstrates that the uniform wholesale price (UWP) is always preferred over the buyer‐specific wholesale price by the supplier because of the effect of innovation stimulation. The optimal timing of pricing is contingent on the level of market demand variance. If two buyers have the same ability to reduce their operating costs via process innovation, the UWP strategy forms a win‐win situation to the supplier and two buyers. Our results provide the supplier with suggestions regarding when to adopt the UWP strategy and how to enhance downstream innovation performance within the supply chain.

show abstract

Section: Literature Reviewmentioning

confidence: 97%

Section: Literature Reviewmentioning

confidence: 99%

Flexible versus committed and specific versus uniform: wholesale price contracting in a supply chain with downstream process innovation

Yan

Xiong

Lin

et al. 2022

Int Trans Operational Res

View full text Add to dashboard Cite

show abstract

“…Several studies have investigated the operational decisions when OEMs outsource new product's manufacturing to CMs (Niu et al, 2021;Shen & Chen, 2019;Wang et al, 2013;Xu et al, 2015;Yoo et al, 2021). Many scholars begin to study the OEMs' outsourcing remanufacturing operations, considering that new and remanufactured products co-exist.…”

Section: Production Outsourcing and Authorization Remanufacturingmentioning

confidence: 99%

Operational and financing decisions of a contract manufacturer under remanufacturing authorization strategy

2023

Manage Decis Econ

View full text Add to dashboard Cite

In recent years, the remanufacturing authorization strategy has widely drawn the attention of practitioners to solve the contradictions and conflicts between contract manufacturers (CMs) and original equipment manufacturers (OEMs). However, few studies about authorization remanufacturing consider that the CM is restricted by the limited initial capital. To fill this gap, we build a supply chain with a capital‐constrained CM and an OEM, where the CM can choose the bank financing or the OEM financing. Our results show that when the wholesale prices are exogenous, the CM will choose the OEM financing strategy if the bank's interest rate is in a relatively low or high range. Conversely, the OEM will not offer financing to the CM under the endogenous wholesale prices. Furthermore, it is interesting to find that the authorization fee under the bank financing is always higher than that under the OEM financing.

show abstract

“…Our work is also related to the co-opetition literature. Cooperative competition implies competition and cooperative coexistence between two or more parties involved in the pursuit of individual goals (Nalebuff et al, 1996). Tang and Kouvelis (2011) studied the benefits of supplier diversification for dual-source monopolies, showing that an increase in supplier relevance leads to an increase in buyer output relevance but a decrease in profits.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Besides, we consider the case that the component quality for the OEM’s products is the same as that for the CM’s products, and thus, their production cost is also the same (Dong et al , 2021; Niu et al , 2021; Chen et al , 2021).…”

Section: Model Developmentmentioning

confidence: 99%

Analyzing entry strategies for co-opetitive supply chains with the learning effect

Lü

Yang

Zhou

et al. 2022

JM2

View full text Add to dashboard Cite

Purpose This study aims to investigate whether the contract manufacturer (CM) should take the first-mover advantage in the end-product without supplying core components to the original equipment manufacturer (OEM) immediately, or should fully squeeze the benefit of the learning effect through an amplified production quantity by letting the OEM enter the end-product market early. Design/methodology/approach The authors propose a two-period model for a supply chain consisting of a CM and an OEM where the CM has four alternative entry strategies concerning it competition to the OEM in the end-product market. For each strategy, the authors derive the equilibrium solutions of the two firms using a backward approach. Comparison leads to the CM’s final choices among the four strategies. Findings For both CM and OEM, the monopoly and the first-entry strategies will be dominated by either the post-entry or the simultaneous-entry strategy, and thus, their preferred strategy is chosen from the latter two. Regarding the two firms choices between the post- and simultaneous-entry strategy, the CM prefers the post-entry strategy when the OEMs brand premium is at a moderate level, whereas the OEM prefers the post-entry strategy when its brand premium is low, and the learning effect can amplify the interval for the CMs adopting the post-entry strategy as well as changes the interval for the OEMs preference related to the two strategies. Originality/value This paper is the first one to explore the optimal strategy for a CM to maximize its profit in a co-opetitive supply chain situation with a CM and an OEM. The authors believe that our paper contributes to both literature and the market.

show abstract

“Production + procurement” outsourcing with competitive contract manufacturer's partial learning and supplier's price discrimination

Cited by 15 publications

References 43 publications

Flexible versus committed and specific versus uniform: wholesale price contracting in a supply chain with downstream process innovation

Flexible versus committed and specific versus uniform: wholesale price contracting in a supply chain with downstream process innovation

Operational and financing decisions of a contract manufacturer under remanufacturing authorization strategy

Analyzing entry strategies for co-opetitive supply chains with the learning effect

Contact Info

Product

Resources

About