Models for Supply Chains in E-Business

Swaminathan, Jayashankar M.; Tayur, Sridhar

doi:10.1287/mnsc.49.10.1387.17309

Cited by 401 publications

(225 citation statements)

References 47 publications

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“…A number of researchers have contributed to the development of design strategy for forward supply chains and our models are motivated by this work (Swaminathan and Tayur 2003, Fisher 1997, Lee and Whang 1999, Lee and Tang 1997, Feitzinger and Lee 1997. We are able to confirm a set of design principles for reverse supply chains.…”

Section: Supply Chain Design Strategymentioning

confidence: 99%

Time Value of Commercial Product Returns

et al. 2006

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Manufacturers and their distributors must cope with an increased flow of returned products from their customers. The value of commercial product returns, which we define as products returned for any reason within 90 days of sale, now exceeds US $100 billion annually in the US. Although the reverse supply chain of returned products represents a sizeable flow of potentially recoverable assets, only a relatively small fraction of the value is currently extracted by manufacturers; a large proportion of the product value erodes away due to long processing delays. Thus, there are significant opportunities to build competitive advantage from making the appropriate reverse supply chain design choices. In this paper, we present a simple queuing network model that includes the marginal value of time to identify the drivers of reverse supply chain design. We illustrate our approach with specific examples from two companies in different industries and then examine how industry clockspeed generally affects the choice between an efficient and a responsive returns network.

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Section: Supply Chain Design Strategymentioning

confidence: 99%

Time Value of Commercial Product Returns

et al. 2006

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“…These models typically assume that excess demand may be lost, possibly with additional penalties, and excess supply may be sold in a "salvage market" (which may be thought of as similar to a spot market, but at a fixed price). A basic review of these results can be found in Cachon (2003), Kleindorfer and Wu (2003), Swaminathan and Tayur (2003). Linking this literature with the options framework here, several papers (Araman et al 2002, Barnes-Schuster et al 2002, Shi et al 2002 show that buy-back contracts, quantity-flexible contracts, information-sharing contracts, as well the classic newsvendor model and others are all special cases of two-part-tariff options (however, these papers only treat the single-seller, single-buyer case).…”

Section: Literature Reviewmentioning

confidence: 99%

Competitive Options, Supply Contracting, and Electronic Markets

2005

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T his paper develops a framework for analyzing business-to-business (B2B) transactions and supply chain management based on integrating contract procurement markets with spot markets using capacity options and forwards. The framework is motivated by the emergence of B2B exchanges in several industrial sectors to facilitate such integrated contract and spot procurement. In the framework developed, a buyer and multiple sellers may either contract for delivery in advance (the "contracting" option) or they may buy and sell some or all of their input/output in a spot market. Contract pricing involves both a reservation fee per unit of capacity and an execution fee per unit of output if capacity is called. The key question addressed is the structure of the optimal portfolios of contracting and spot market transactions for the buyer and these sellers, and the pricing thereof in market equilibrium. Existence and structure of market equilibria are characterized for the associated competitive game between sellers with heterogeneous technologies, under the assumption that they know the buyer's demand function. This allows an explicit characterization of the price of capacity options and the value of managerial flexibility, as well as providing conditions under which B2B exchanges are efficient and sustainable.

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“…[18] are the most outstanding ones. Many of these authors' analytical models provide satisfactory results, although some methodological difficulties could arise from the structure of the models developed when it comes to applying them, as well as considerable constraints in their field of application, owing to some rigid conditions established, such as, for example, the fact that they concentrate only on one parameter [19]. It should also be noted that the article by Lee et al [20] provides an excellent approach to the analysis of the causes and potential solutions of the Bullwhip effect.…”

Section: Introductionmentioning

confidence: 99%