Strategic integration decision under supply chain competition in the presence of online channel

Subrata Saha*, Izabela Nielsen

*Kontaktforfatter

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

6 Citationer (Scopus)
28 Downloads (Pure)

Abstract

This study explores the pricing decisions of substitutable products for two competing supply chains in the presence of an online channel. Each supply chain consisting of a single manufacturer and an exclusive retailer and one of the manufacturers distributes products through the online channel. We examine optimal decisions under five scenarios to explore how the strategic cooperation between two manufacturers at the upstream horizontal level or with the retailer at the vertical level affects product pricing decisions and the performance of two supply chains? The results reveal that decisions for cooperation with competing manufacturers and opening an online channel are correlated. In the absence of an online channel, cooperation with their respective retailer can lead to a higher supply chain profit. However, if a manufacturer opens an online channel, then cooperation with competing manufacturers can lead to a higher supply chain profit. Under the vertical integration, total supply chain profit might be lower compared to a scenario where members in each supply chain remain independent. Consumers also need to pay more for products.

OriginalsprogEngelsk
Artikelnummer58
TidsskriftSymmetry
Vol/bind13
Udgave nummer1
Sider (fra-til)1-20
Antal sider20
ISSN2073-8994
DOI
StatusUdgivet - dec. 2021

Bibliografisk note

Publisher Copyright:
© 2020 by the authors. Licensee MDPI, Basel, Switzerland.

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