Quick response and supply chain structure with strategic consumers

Yang, De’an; Qi, Ershi; Li, Yajiao

doi:10.1016/j.omega.2014.10.006

Cited by 81 publications

(48 citation statements)

References 46 publications

(83 reference statements)

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“…Tang, Rajaram, Alptekinoğlu, and Ou () examined the benefits of advanced booking discounts in retail supply chain operations. More recent studies on quick response supply chain management include the following: an exploration of the role played by quick response in the fast fashion supply chain (Cachon & Swinney, ), an analysis of the quick response program under competition (Lin and Parlaktürk, ), a study on applying quick response in supply chain systems facing forward‐looking consumers (Yang, Qi, & Li, ), an analysis of the quick response supply chain with a risk‐averse retailer (Choi, ), and an investigation of bounded rationality behaviors of human managers in the quick response supply chain (Choi, ). Similar to the above reviewed works, this article studies quick response in the supply chain context.…”

Section: Literature Reviewmentioning

confidence: 99%

Quick Response in Supply Chains with Stochastically Risk Sensitive Retailers*

2017

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Quick response is a supply chain practice that can help improve operations by responding quickly to market changes. In particular, when retailers are perfectly rational and risk neutral, quick response is known to be a highly beneficial strategy to the retailers. However, in practice, retailers may possess different kinds of unstable risk preferences, which include risk‐averse and risk‐seeking attitudes. Thus, retailers may be stochastically risk sensitive. In this article, we consider all these factors simultaneously and explore how the retailer's stochastic risk preference affects the values of quick response to the supply chain and its members. Among various findings, we show that quick response is always beneficial to the supply chain when the retailer is stochastically risk sensitive. In most cases, we demonstrate that if the retailer is more risk averse (risk seeking) stochastically, the retailer is benefited more, whereas the manufacturer suffers a smaller profit loss (a bigger profit loss), under quick response. We prove that different commonly used supply chain contracts can achieve robust Pareto improvement in the supply chain. We also uncover that if the manufacturer ignores the retailer's stochastic risk preference, the achievability of Pareto improvement by contracts will be negatively affected.

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Section: Literature Reviewmentioning

confidence: 99%

Quick Response in Supply Chains with Stochastically Risk Sensitive Retailers*

2017

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“…For example, Choi [23] investigates how carbon footprint tax would affect firms' sourcing decisions when environment sustainability is a concern. Yang et al [24] study the impact of quick response on the supply chain performance, in the presence of strategic consumer behaviors. Zhao et al [25] study a model in which demand information update and spot price information update are both considered.…”

Section: Literature Reviewmentioning

confidence: 99%

Forward Sourcing or Spot Trading? Optimal Commodity Procurement Policy with Demand Uncertainty Risk and Forecast Update

Niu

Chu

2017

IEEE Systems Journal

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We consider a commodity procurement problem where a firm satisfies a future customer demand with uncertainty risk via spot trading and forward sourcing. Although the firm can make demand forecast update and hence, remove demand uncertainty when the selling season arrives, it is still susceptible to a high emergency logistics cost at that time spot. Therefore, in this paper, the tradeoff between the mismatching cost of supply and uncertain demand (highest at the beginning of the planning horizon) and the high at-once delivery cost (highest at the ending of the planning horizon) is investigated. We develop a two-stage model and derive the optimal procurement policy for the firm. We also characterize the optimal parameters by assuming demand follows a bivariate normal distribution. Finally, extensive Monte-Carlo simulation is conducted and we quantify the value of forward contracts and the value of information update, using the crude oil data.

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“…Kiane investigated how quick responses and coupons jointly impact consumer behavior [11]. Researchers began to focus on the relationship of customer, especial strategic customer and quick response [12] [13].…”

Section: Review Of Studies On Quick Response and Logistic Systemmentioning

confidence: 99%