A single buyer-single supplier bargaining problem with asymmetric information : theoretical approach and software implementation

This paper is focused on the coordination of order and production policy between buyers and suppliers in supply chains. When a buyer and a supplier of an item work independently, the buyer will place orders based on his economic order quantity (EOQ). However, the buyer s EOQ may not lead to an optimal policy for the supplier. It can be shown that a cooperative batching policy can reduce total cost significantly. Should the buyer have the more powerful position to enforce his EOQ on the supplier, then no incentive exists for him to deviate from his EOQ in order to choose a cooperative batching policy. To provide an incentive to order in quantities suitable to the supplier, the supplier could offer a side payment. One critical assumption made throughout in the literature dealing with incentive schemes to influence buyer s ordering policy is that the supplier has complete information regarding buyer s cost structure. However, this assumption is far from realistic. As a consequence, the buyer has no incentive to report truthfully on his cost structure. Moreover there is an incentive to overstate the total relevant cost in order to obtain as high a side payment as possible. This paper provides a bargaining model with asymmetric information about the buyer s cost structure assuming that the buyer has the bargaining power to enforce his EOQ on the supplier in case of a break-down in negotiations. An algorithm for the determination of an optimal set of contracts which are specifically designed for different cost structures of the buyer, assumed by the supplier, will be presented. This algorithm was implemented in a software application, that supports the supplier in determining the optimal set of contracts

Examining Drivers of Consumer Returns in E-Tailing with Real Shop Data

Returns management – an important component of supply chain management – is a key aspect of online retailers’ business models. Despite increasing interest in this issue, few studies have published empirical results on the drivers of consumer returns in e-tailing. Because this knowledge is essential to enabling better decisions about return flows, we explored an extensive dataset from an online apparel retailer using linear and logistic regression models. This approach distinguishes our study from other empirical work, which is usually based on survey methods. Before the data analysis, previously untested hypotheses were formulated using established theories and anecdotal information

Maturity Models in the Age of Industry 4.0 – Do the Available Models Correspond to the Needs of Business Practice?

Maturity models (MMs) enable users to identify the need for change and to derive the necessary measures to accompany the change process. Existing literature reviews indicate that the number of available models has increased sharply in recent years. At the same time, it is found that the number of model applications does not keep up with the pace of development. Against the background of the current digitization trend, this article empirically investigates which models are actually used in business practice. We find that the degree of application is very low. Moreover, we also examine user-related model requirements, reasons for employing MMs, and the purpose of using MMs, which can support the user-centered development of future MMs

Making Third-Party Sellers More Attractive—The Case of Amazon

We provide an analysis of third-party sellers on Amazon’s online marketplace from a customer’s viewpoint. While Amazon as a retailer sometimes directly competes with third-party sellers, Amazon is also interested in making the Amazon marketplace attractive for third-party sellers and making third-party sellers attractive to customers. Based on a large-scale survey (n=772) of Amazon customers in the U.S., we examine how much they like to buy from the different seller types (Amazon itself, third-party sellers with/without the Prime logo, i.e., with/without Fulfillment by Amazon). Among other results, we can show that the Prime logo on the seller side combined with a Prime subscription on the customer side significantly increases trust in a third-party seller, ultimately increasing third-party sales on Amazon’s online marketplace. Furthermore, third-party sellers are implicitly incentivized to use the Fulfillment by Amazon service, which generates additional logistics service revenue for Amazon