The Effect of Bidimensional Power Structure on Supply Chain Decisions and Performance

Chen, Xu; Wang, Xiaojun; Gong, Ke

doi:10.1109/tsmc.2017.2704445

Cited by 17 publications

(6 citation statements)

References 49 publications

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“…The literature on supply chains has first concerns for the power structure and argues that different bargaining power among manufacturers and retailers refers to different power structures [38,39]. The members who own huge brand and user resources (e.g., major traditional retailers like Wal-Mart) usually have dominant bargaining power.…”

Section: Power Structure In E-commerce Supply Chainsmentioning

confidence: 99%

How Should E-Commerce Platforms Subsidize Retailers with Logistics Constraints during an Epidemic Scenario? Considering Power Structure and Altruistic Preference

Zhang

2021

JTAER

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To maintain the sustainable development of a platform’s economy, e-commerce platforms put forward various subsidy programs to retailers selling on them during COVID-19. This paper investigates an e-commerce platform’s decision on subsidizing a retailer selling on it with logistics constraints during an epidemic scenario, with a focus on the role of power structure and altruistic preference. By constructing two Stackelberg game models, the research obtains the optimal subsidy under two power structures (i.e., the dominant platform and the weaker platform), respectively. The comparison between them shows that the conditions of the dominant platform giving subsidies (both altruistic preference and logistics constraints should be higher enough) are stricter than the weaker platform. Considering the same altruistic preference and logistics constraints, the optimal subsidy provided by the weaker platform should always be not less than the dominant platform. However, the weaker platform, surprisingly, can get more utility by lowering its altruistic preference voluntarily when the commission fee is low. No matter what the power structure is, the optimal subsidy increases with the logistics service coefficient and altruistic preference, and the dominant member’s profit/utility is not less than the weaker one, which confirms “the first mover advantage”. Finally, more managerial implications to the platform-retailer systems are discussed.

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Section: Power Structure In E-commerce Supply Chainsmentioning

confidence: 99%

How Should E-Commerce Platforms Subsidize Retailers with Logistics Constraints during an Epidemic Scenario? Considering Power Structure and Altruistic Preference

Zhang

2021

JTAER

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“…Following Mukhopadhyay et al [37], Shang et al [38], and Chen et al [39], we assume that the customer demand Complexity via the offline channel is d 1 (p 1 , p 2 ) � θα − βp 1 + cp 2 , and the customer demand via the online channel is…”

Section: Model Description and Assumptionsmentioning

confidence: 99%

Price Cap Models in Pharmaceutical Online-to-Offline Supply Chains

et al. 2020

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Pharmaceutical supply chains are often highly complex with conflicting objectives of social welfare and profit maximization. Furthermore, there are various stakeholders including pharmaceutical manufacturer, distributors, retailers, patients, and the government. In this paper, we consider a two-stage supply chain consisting of one pharmaceutical manufacturer and a pharmacy with online and offline channels. We focus on four price cap models: no price cap regulation, pharmaceutical manufacturer’s price cap regulation, pharmacy price cap regulation, and linkage price cap regulation. We apply game theory, investigate how the price cap regulations affect the firms’ pricing, and evaluate the economic performance and social welfare of the dual-channel pharmaceutical supply chain. Our findings show that first, like the single-channel pharmaceutical supply chain, the profit of the regulated firm always decreases and the profit of the unregulated firm always increases when they are under one-sided price cap regulations. Second, the impacts of the linkage price cap regulation on the supply chain are more complicated depending on the linkage coefficient and market share. Overall, our findings can provide theoretical and practical insights to help the government devise price cap regulations for complex modern pharmaceutical supply chains.

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“…Suppliers (retailers) are substitutes, and there is no flow of goods in the horizontal competition. The study by Chen et al [10] showed that the power structure of the vertical supply chain has a more significant impact on the financial performance of individual firms or the entire supply chain than the horizontal supply chain. In order to simplify the model without compromising the purpose of the study, we assume that the market power between suppliers (retailers) is equal and thus adopt the Cournot game model.…”

Section: Introductionmentioning

confidence: 99%

“…In terms of the impact of dominance on profit, similar findings were obtained: the dominant party has the right to prioritize decision-making and, therefore, has a first-mover advantage to obtain a higher level of profit. However, some researchers argue that whether a firm can benefit from dominance is also influenced by factors such as the demand function, demand uncertainty [4,5], the price sensitivity coefficient [10,25], and so on.…”

Section: Introductionmentioning

confidence: 99%

The Influence of Demand Fluctuation and Competition Intensity on Advantages of Supply Chain Dominance

He,

Ni,

Jiang

et al. 2023

Mathematics

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We studied a supply chain consisting of multiple suppliers and multiple retailers. We use the Cournot–Stackelberg game, the Market–Stackelberg game, and the Market–Nash game to simulate the situation where the upstream seller’s market dominance power gradually decreases while the downstream buyer’s market power increases. The equilibrium decision and supply chain performance under the three models are compared and analyzed, as well as their responses to external market changes such as demand fluctuation and market competition intensity. The research shows that (1) in a seller-dominated supply chain, the increase in buyer power reduces market equilibrium production and wholesale price; (2) in the face of strong demand fluctuations, equivalent power between upstream and downstream can contribute to the stabilization of production and wholesale prices; (3) when market demand fluctuation is small, market power brings a higher profit level, and supply chain participants would like to actively compete for market power. However, when the demand fluctuates greatly, the profit advantage brought by market dominance is no longer significant, and there is no need to spend much to fight for market dominance; (4) the fierce competition of upstream suppliers will induce upstream to give up the competition for market dominance, and make the market power less attractive to downstream retailers. While the fierce horizontal competition downstream will stimulate both suppliers and retailers to actively compete for market power, (5) sufficient market competition will improve total supply chain profit, so encouraging competition is conducive to the overall economic development of society.

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The Effect of Bidimensional Power Structure on Supply Chain Decisions and Performance

Cited by 17 publications

References 49 publications

How Should E-Commerce Platforms Subsidize Retailers with Logistics Constraints during an Epidemic Scenario? Considering Power Structure and Altruistic Preference

How Should E-Commerce Platforms Subsidize Retailers with Logistics Constraints during an Epidemic Scenario? Considering Power Structure and Altruistic Preference

Price Cap Models in Pharmaceutical Online-to-Offline Supply Chains

The Influence of Demand Fluctuation and Competition Intensity on Advantages of Supply Chain Dominance

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