Sale Timing in a Supply Chain: When to Sell to the Retailer
Manufacturing & Service Operations Management
Cooperative production networks: multiagent modeling and planning
Acta Cybernetica
Managing Inventory Over a Short Season: Models with Two Procurement Opportunities
Manufacturing & Service Operations Management
Quick Response and Retailer Effort
Management Science
Coordination Strategies in an SaaS Supply Chain
Journal of Management Information Systems
The Value of Collaborative Forecasting in Supply Chains
Manufacturing & Service Operations Management
A pricing model for a service inventory system when demand is price and waiting time sensitive
ICCSA'05 Proceedings of the 2005 international conference on Computational Science and Its Applications - Volume Part IV
A generalized model of partial resale
Decision Support Systems
Contract analysis: A performance measures and profit evaluation within two-echelon supply chains
Computers and Industrial Engineering
Price-only contracts with backup supply
Operations Research Letters
Profit loss in differentiated oligopolies
Operations Research Letters
Cargo Capacity Management with Allotments and Spot Market Demand
Operations Research
Modeling supply contracts in semiconductor supply chains
Proceedings of the Winter Simulation Conference
How to Price Discriminate When Tariff Size Matters
Marketing Science
Coordinated Drop Shipping Commitment Contract in Dual-Distribution Channel Supply Chain
Journal of Electronic Commerce in Organizations
Advance Selling in a Supply Chain Under Uncertain Supply and Demand
Manufacturing & Service Operations Management
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While every firm in a supply chain bears supply risk (the cost of insufficient supply), some firms may, even with wholesale price contracts, completely avoid inventory risk (the cost of unsold inventory). With a push contract there is a single wholesale price and the retailer, by ordering his entire supply before the selling season, bears all of the supply chain's inventory risk. A pull contract also has a single wholesale price, but the supplier bears the supply chain's inventory risk because only the supplier holds inventory while the retailer replenishes as needed during the season. (Examples include Vendor Managed Inventory with consignment and drop shipping.) An advance-purchase discount has two wholesale prices: a discounted price for inventory purchased before the season, and a regular price for replenishments during the selling season. Advance-purchase discounts allow for intermediate allocations of inventory risk: The retailer bears the risk on inventory ordered before the season while the supplier bears the risk on any production in excess of that amount. This research studies how the allocation of inventory risk (via these three types of wholesale price contracts) impacts supply chain efficiency (the ratio of the supply chain's profit to its maximum profit). It is found that the efficiency of a single wholesale price contract is considerably higher than previously thought as long as firms consider both push and pull contracts. In other words, the literature has exaggerated the value of implementing coordinating contracts (i.e., contracts that achieve 100% efficiency, such as buy-backs or revenue sharing) because coordinating contracts are compared against an inappropriate benchmark (often just a push contract). Furthermore, if firms also consider advance-purchase discounts, which are also simple to administer, then the coordination of the supply chain and the arbitrary allocation of its profit is possible. Several limitations of advance-purchase discounts are discussed.