Buyer’s strategic demand information sharing with an upstream echelon for entry promotion

Information sharing and marketing channel building have become an important problem of supply chain management theory and practice. The research of information sharing focused on traditional channel of supply chain between upstream and downstream enterprises; however, the research ignores the behavior of information sharing with potential entrants and composite structure characteristics about traditional marketing channel with the direct channel. This paper uses the model to research the effects brought about sharing demand information with potential entrants and building marketing channel, which reveals information sharing and channel building mechanism in the supply chain. The study found that the five-force model of Porter regards potential entrants only as a threat that is one-sided. When the channel competitiveness meets certain conditions, manufacturer and retailer will share demand information with potential entrants. Building composite marketing channel is the manufacturer's absolute dominant strategy. Channel construction will increase the entry barriers for potential entrants and weaken the effect of double marginalization; meanwhile, the performance of supply chain will be augmented.

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Simulation Research on Information-Sharing Value of Two-Level Supply Chain

Security and Communication Networks ◽

10.1155/2021/5361887 ◽

2021 ◽

Vol 2021 ◽

pp. 1-8

Author(s):

Xiaheng Zhang ◽

Zekai Lin ◽

Lin Xiao

Keyword(s):

Supply Chain ◽

Performance Evaluation ◽

Information Sharing ◽

Chain Model ◽

Simulation Research ◽

Incentive Effect ◽

Actual Evaluation ◽

Demand Information ◽

And Performance ◽

The Impact

In the two-stage supply chain model, the incentive effect to the supplier’s sharing of demand information and performance evaluation and the effect of various parameters on the incentive effect of the supply chain are studied through a multiagent simulation model constructed for the purpose. It is found that the incentive coefficient of demand information-sharing degree, the number of selected suppliers, the order allocation coefficient, and the order proportion are positively related to the incentive effect of demand information sharing. So, the greater the demand information sharing is, the greater the impact of these parameters on the incentive effect is. Based on the demand information sharing, the supplier performance evaluation rules are shared, and when the actual evaluation rules are inconsistent with the supplier’s expectations, the incentive effect is further enhanced. Other parameters do not affect the incentive effect of demand information sharing and performance evaluation rule sharing.

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Sharing Demand Information with Retailer Under Upstream Competition

Management Science ◽

10.1287/mnsc.2021.4116 ◽

2021 ◽

Author(s):

Aditya Jain

Keyword(s):

Information Sharing ◽

Private Information ◽

Operations Management ◽

Information Acquisition ◽

Wholesale Price ◽

Substitutable Products ◽

Downward Pressure ◽

Demand Information ◽

Intensity Of Competition ◽

Share Information

We analyze demand information sharing collaboration between two manufacturers and a retailer under upstream competition. The manufacturers produce partially substitutable products, which are stocked by the retailer that sells them in the market characterized by random demand. The manufacturers are privately informed about uncertain demand and decide on whether to share this information with the retailer. We show that by not sharing information, a manufacturer ends up distorting its wholesale price upward to signal its private information to the retailer, and under upstream competition, this distortion is propagated to the competing manufacturer. Thus, although a manufacturer’s decision to not share information may benefit or hurt its own profit, this always benefits the competing manufacturer. Under low intensity of competition, signaling-driven distortions exacerbate double marginalization and hurt all parties, whereas under more intense competition, these distortions help manufacturers offset downward pressure on wholesale prices. Thus, in equilibrium similarly informed manufacturers share information in the former case but not in the latter case. Additionally, when manufacturers differ in their information accuracies, only the better-informed manufacturer shares information. The retailer always benefits from both manufacturers sharing information, and its benefits are larger when the better-informed manufacturer shares information. We show existence of a contracting mechanism the retailer can employ to enable information sharing. Finally, we analyze manufacturers’ information acquisition decisions and find that under competition, two manufacturers acquire minimal information so that they are better off not sharing information in the information sharing game. This paper was accepted by Vishal Gaur, operations management.

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Coordination of elderly healthcare service supply chain with information asymmetry: Designs of option contracts under different demand distribution statuses

RAIRO - Operations Research ◽

10.1051/ro/2019032 ◽

2020 ◽

Vol 54 (5) ◽

pp. 1291-1307

Author(s):

Jun Zhao

Keyword(s):

Supply Chain ◽

Information Asymmetry ◽

Information Sharing ◽

Healthcare Service ◽

Demand Distribution ◽

Service Supply Chain ◽

Option Contract ◽

Demand Information ◽

Continuous Demand ◽

Elderly Healthcare

This paper studies the issue of demand information asymmetry in an elderly healthcare service (EHS) system represented by a two-echelon elderly healthcare service supply chain (EHSSC) comprising an elderly service integrator (ESI) and a service provider (ESP). The goal of the ESI is to decide on how much service capacity is required for placing orders to the ESP, who directly serves the customers. Considering discrete and continuous demand distribution statuses, a centralised model with symmetric demand information and decentralised models with asymmetric demand information are developed to analyse the optimal ordering decisions and discuss the influence of information asymmetry. Furthermore, option contracts are applied to help coordinate the supply chain under asymmetric demand information based on different demand distribution statuses. Optimal option contract menus are designed for the ESP to promote the information sharing. Results show that the option contract can coordinate the EHSSC with asymmetric demand information under both discrete and continuous demand distribution statuses. The exercise price will be higher under lower demand information than that under higher demand information and the transfer payment will be less under lower demand information than that under higher demand information. Moreover, although the ESI has demand information superiority and can make use of opportunistic behaviour to maximise its own profit, the ESP as the leader can design the option contract to incentive the ESI to achieve true information sharing, and even obtain nearly all of the channel profit.

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