Many companies have embarked on initiatives that enable more demand information sharing between retailers and their upstream suppliers. While the literature on such initiatives in the business press is proliferating, it is not clear how one can quantify the benefits of these initiatives and how one can identify the drivers of the magnitudes of these benefits. Using analytical models, this paper aims at addressing these questions for a simple two-level supply chain with nonstationary end demands. Our analysis suggests that the value of demand information sharing can be quite high, especially when demands are significantly correlated over time.supply chain management, mathematical models, production planning and inventory control, approximate analysis, electronic data interchange, quick response, information sharing

We consider an on-demand service platform using earning sensitive independent providers with heterogeneous reservation price (for work participation) to serve its time and price sensitive customers with heterogeneous valuation of the service. As such, both the supply and demand are "endogenously" dependent on the price the platform charges its customers and the wage the platform pays its independent providers. We present an analytical model with endogenous supply (number of participating agents) and endogenous demand (customer request rate) to study this on-demand service platform. To coordinate endogenous demand with endogenous supply, we include the steady-state waiting time performance based on a queueing model in the customer utility function to characterize the optimal price and wage rates that maximize the profit of the platform. We first analyze a base model that uses a fixed payout ratio (i.e., the ratio of wage over price), and then extend our model to allow the platform to adopt a time-based payout ratio. We find that it is optimal for the platform to charge a higher price when demand increases; however, the optimal price is not necessarily monotonic when the provider capacity or the waiting cost increases. Furthermore, the platform should offer a higher payout ratio as demand increases, capacity decreases or customers become more sensitive to waiting time.We also find that the platform should lower its payout ratio as it grows with the number of providers and customer demand increasing at about the same rate. We use a set of actual data from a large on-demand ride-hailing platform to calibrate our model parameters in numerical experiments to illustrate some of our main insights.

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Many service firms use delivery time guarantees to compete for customers in the marketplace. In this research we develop a stylized model to analyze the impact of using time guarantees on competition. Demands are assumed to be sensitive to both the price and delivery time guarantees, and the objective of each firm is to select the best price and time guarantee to maximize its operating profit. We first analyze the optimization problem for the individual firms and then study the equilibrium solution in a multiple-firm competition. Using a numerical study, we further illustrate how the different firm and market characteristics would affect the price and delivery time competition in the market. Our results suggest that the equilibrium price and time guarantee decisions in an oligopolistic market with identical firms behave in a similar fashion as the optimal solution in a monopolistic situation from a previous study. However, when there are heterogeneous firms in the market, these firms will exploit their distinctive firm characteristics to differentiate their services. Assuming all other factors being equal, the high capacity firms provide better time guarantees, while firms with lower operating costs offer lower prices, and the differentiation becomes more acute as demands become more time-sensitive. Furthermore, as time-attractiveness of the market increases, firms compete less on price, and the equilibrium prices of the firms increase as a result. Our findings provide important implications about firm behaviour under price and time competition.time-based competition, price competition, service guarantees, competitive games