Retailer or e-tailer? Strategic pricing and economic-lot-size decisions in a competitive supply chain with drop-shipping

@article{Chiang2010RetailerOE,
  title={Retailer or e-tailer? Strategic pricing and economic-lot-size decisions in a competitive supply chain with drop-shipping},
  author={W. K. Chiang and Y. Feng},
  journal={Journal of the Operational Research Society},
  year={2010},
  volume={61},
  pages={1645-1653}
}
  • W. K. Chiang, Y. Feng
  • Published 2010
  • Economics, Computer Science
  • Journal of the Operational Research Society
Drop-shipping is an arrangement whereby an e-tailer, who does not hold inventories, processes orders and requests a manufacturer to ship products directly to the end customers. To explore the economic benefits of adopting drop-shipping distribution strategy in a competitive environment, we investigate the profitability and the efficiency of the drop-shipping channel as compared to the traditional channel. Specifically, we develop Economic Order Quantity (EOQ) games with pricing and lot-sizing… Expand
Reselling or drop shipping: Strategic analysis of E-commerce dual-channel structures
TLDR
A game-theoretic analysis of the drop-shipping strategy of a retailer under two practical dual-channel supply chain structures, namely, manufacturer-owned and retailer-owned online channel structures (MOS and ROS). Expand
Wholesale or drop-shipping: Contract choices of the online retailer and the manufacturer in a dual-channel supply chain
Abstract We consider a dual-channel supply chain consisting of a manufacturer, an online retailer, and a physical store, where the online order is fulfilled by either the conventional wholesaleExpand
Impact of supply chain power and drop-shipping on a manufacturer's optimal distribution channel strategy
TLDR
This paper investigates the impact of supply chain power structure in terms of market power and retail channel dominance on a manufacturer’s optimal distribution channel strategy and finds that a manufacturer never prefers a drop-shipping etailer as the first mover in a sequential pricing game with a batch ordering traditional retailer. Expand
Supply chain choice with financial constraints on the internet: Drop shipping vs. traditional channel
TLDR
This study analyzes channel choice on the internet between drop shipping and traditional channel in a supply chain including a wholesaler W and multiple financially constrained online retailers to understand the impact of a retailer’s financial constraints on her supply chain structure on theinternet. Expand
Drop-Shipping and Backup-Sourcing Strategies Under the Risk of Supply Disruption
TLDR
This study develops a multi-stage game-theoretical model to investigate the optimal procurement decisions for an e-retailer who can activate both drop-shipping and backup-sourcing strategies and shows that for the retailer, the activation of both backup-Sourcing and drop- shipping strategies increases its profit, and there is substitutability between the two strategies. Expand
Integration of three echelon supply chain (supplier-manufacturer-distributor-drop shipper) with permissible delay in payment and penalty contract
Supply Chain Management (SCM) has to be considered in the company in order to improve the sustainability and competitiveness. SCM executed to integrating any companies on the supply chain in a way ofExpand
Assessing the impact of drop-shipping fulfilment operations on the upstream supply chain
TLDR
This research extends the current drop-shipping literature by shifting the research focus away from retailers to suppliers; and hence, shifting the focus from strategic use of drop-Shipping towards a more tactical/operational perspective by exploring those who carry out drop- shipping operations. Expand
Effect of Inventory Information Discrepancy in a Drop-Shipping Supply Chain
TLDR
The numerical experiments indicate that both parties can have significant amount of the percentage cost reductions if the information discrepancy can be eliminated, and the potential savings are substantial especially when the errors have large variability. Expand
Pricing Strategies of a Traditional Retailer and a Direct Distributor When Consumers Hold Channel Preferences
This paper studies the price game between a traditional retailer and a direct distributor who have different channel preferences. Both of the decision makers’ objectives are to maximize theirExpand
E-tailer’s procurement strategies for drop-shipping: Simultaneous vs. sequential approach to two manufacturers
TLDR
The effect of drop-shipping on the procurement strategy of an e-tailer who sells products for two upstream competing manufacturers is examined, and it is found that the e-tailser prefers simultaneous structure over sequential structure in the BO mode, while in the HS mode she chooses sequential structure. Expand
...
1
2
3
...

References

SHOWING 1-10 OF 23 REFERENCES
The evaluation of drop shipping option for e-commerce retailers☆
Many e-commerce retailers use drop shipping to satisfy demand. A retailer simply forwards customers' orders to the manufacturer who fills the orders directly to the customers and is paid aExpand
Supply Chain Choice on the Internet
TLDR
This work model the dual strategy as a noncooperative game among the retailers and the wholesaler, analyze it, and obtain insights into the structural properties of the equilibrium solution to facilitate development of recommendations for practicing managers. Expand
Inventory rationing via drop-shipping in Internet retailing: A sensitivity analysis
TLDR
A Monte Carlo simulation model is developed to examine a threshold level inventory rationing policy that is of interest to e-tailers, operating in a business to consumer (B2C) environment and selling non-perishable, made-to-stock items such as books, CDs, consumer electronics, and body and bath products. Expand
Coordination of joint pricing-production decisions in a supply chain
We consider the coordination of dynamic, joint pricing-production/ordering decisions in a decentralized supply chain where a manufacturer outsources her product distribution/retailing function to anExpand
Direct Marketing, Indirect Profits: A Strategic Analysis of Dual-Channel Supply-Chain Design
The advent of e-commerce has prompted many manufacturers to redesign their traditional channel structures by engaging in direct sales. The model conceptualizes the impact of customer acceptance of aExpand
Marketing-production decisions in an industrial channel of distribution
This paper presents a model that considers the interface between marketing and production decisions in a channel of distribution of industrial goods comprised of a manufacturer and a distributor. TheExpand
Improving buyer-seller system cooperation through inventory control
Abstract Much of the literature pertaining to inventory control systems assumes a perfectly competitive market in which increases or decreases in the buyer's purchase costs affect neither the finalExpand
The role of e-tailer inventory policy on e-tailer pricing and profitability
Abstract This study explores the impact of the e-tailer's inventory policy on its pricing strategy and profitability via a two-period model. Specifically, we identify two inventory policies: zeroExpand
Price Competition between Pure Play vs. Bricks-and-Clicks E-Tailers: Analytical Model and Empirical Analysis
In this paper, we first develop a game theoretic model of price competition between a pure play e-tailer and a bricks-and-clicks e-tailer. We show that in general, the pure play e-tailer has a lowerExpand
Determining Optimal Selling Price and Lot Size When the Supplier Offers All‐Unit Quantity Discounts*
This paper is concerned with finding the optimal price and lot size for a retailer purchasing a product for which the supplier offers all-unit quantity discounts. Demand for the product is assumed toExpand
...
1
2
3
...