Revenue-sharing and volume flexibility in the supply chain

We model capacity choice and utilization of a manufacturer selling products through a retailer under a revenue sharing contract. We derive the optimal revenue sharing contract which internalizes the impact on capacity, utilization choice and the final downstream price of the product and provide a va...

ver descrição completa

Detalhes bibliográficos
Autores: Koussis, Nicos, Silaghi, Florina|||0000-0002-2188-236X
Formato: artículo
Fecha de publicación:2023
País:España
Recursos:Universitat Autònoma de Barcelona
Repositorio:Dipòsit Digital de Documents de la UAB
Idioma:inglés
OAI Identifier:oai:ddd.uab.cat:288114
Acesso em linha:https://ddd.uab.cat/record/288114
https://dx.doi.org/urn:doi:10.1016/j.ijpe.2023.108845
Access Level:acceso abierto
Palavra-chave:Vertical integration
Real options
Volume flexibility
Supply chain
id ES_fab10a2efc0d4464c93bdac47a605d4d
oai_identifier_str oai:ddd.uab.cat:288114
network_acronym_str ES
network_name_str España
repository_id_str
spelling Revenue-sharing and volume flexibility in the supply chainKoussis, NicosSilaghi, Florina|||0000-0002-2188-236XVertical integrationReal optionsVolume flexibilitySupply chainWe model capacity choice and utilization of a manufacturer selling products through a retailer under a revenue sharing contract. We derive the optimal revenue sharing contract which internalizes the impact on capacity, utilization choice and the final downstream price of the product and provide a valuation of the retailer and supplier under uncertainty in a multiperiod setting. In extensions of this framework, we analyze constraints on minimum delivered quantities and also build a finite-time numerical method that considers an abandonment option for the supplier and hold-up problems for the retailer, as well as the supplier's option to expand capacity. Our model predicts higher revenue sharing ratios charged by retailers when suppliers operate in more volatile upstream markets, when the product is a necessity rather than a luxury good and when retailers can impose minimum delivered quantities. On the contrary, we find that suppliers will be able to obtain a higher revenue share when operating in industries with high fixed costs and for contracts of shorter horizon since hold-up problems for retailers increase and the retailer has to provide more incentives to suppliers not to abandon operations. The option to expand capacity benefits more significantly the supplier compared to the retailer. Finally, we consider the decisions of a vertically integrated firm showing the gains from vertical integration and demonstrating that the optimum vertically coordinated production can be achieved in the decentralized multiperiod setup through a combination of a fee per product and revenue sharing. 22023-01-0120232023-01-01Articlehttp://purl.org/coar/resource_type/c_6501VoRhttp://purl.org/coar/version/c_970fb48d4fbd8a85info:eu-repo/semantics/articleapplication/pdfhttps://ddd.uab.cat/record/288114https://dx.doi.org/urn:doi:10.1016/j.ijpe.2023.108845reponame:Dipòsit Digital de Documents de la UABinstname:Universitat Autònoma de BarcelonaInglésengopen accesshttp://purl.org/coar/access_right/c_abf2Aquest document està subjecte a una llicència d'ús Creative Commons. Es permet la reproducció total o parcial, la distribució, i la comunicació pública de l'obra, sempre que no sigui amb finalitats comercials, i sempre que es reconegui l'autoria de l'obra original. No es permet la creació d'obres derivades.https://creativecommons.org/licenses/by-nc-nd/4.0/info:eu-repo/semantics/openAccessoai:ddd.uab.cat:2881142026-06-06T12:50:31Z
dc.title.none.fl_str_mv Revenue-sharing and volume flexibility in the supply chain
title Revenue-sharing and volume flexibility in the supply chain
spellingShingle Revenue-sharing and volume flexibility in the supply chain
Koussis, Nicos
Vertical integration
Real options
Volume flexibility
Supply chain
title_short Revenue-sharing and volume flexibility in the supply chain
title_full Revenue-sharing and volume flexibility in the supply chain
title_fullStr Revenue-sharing and volume flexibility in the supply chain
title_full_unstemmed Revenue-sharing and volume flexibility in the supply chain
title_sort Revenue-sharing and volume flexibility in the supply chain
dc.creator.none.fl_str_mv Koussis, Nicos
Silaghi, Florina|||0000-0002-2188-236X
author Koussis, Nicos
author_facet Koussis, Nicos
Silaghi, Florina|||0000-0002-2188-236X
author_role author
author2 Silaghi, Florina|||0000-0002-2188-236X
author2_role author
dc.subject.none.fl_str_mv Vertical integration
Real options
Volume flexibility
Supply chain
topic Vertical integration
Real options
Volume flexibility
Supply chain
description We model capacity choice and utilization of a manufacturer selling products through a retailer under a revenue sharing contract. We derive the optimal revenue sharing contract which internalizes the impact on capacity, utilization choice and the final downstream price of the product and provide a valuation of the retailer and supplier under uncertainty in a multiperiod setting. In extensions of this framework, we analyze constraints on minimum delivered quantities and also build a finite-time numerical method that considers an abandonment option for the supplier and hold-up problems for the retailer, as well as the supplier's option to expand capacity. Our model predicts higher revenue sharing ratios charged by retailers when suppliers operate in more volatile upstream markets, when the product is a necessity rather than a luxury good and when retailers can impose minimum delivered quantities. On the contrary, we find that suppliers will be able to obtain a higher revenue share when operating in industries with high fixed costs and for contracts of shorter horizon since hold-up problems for retailers increase and the retailer has to provide more incentives to suppliers not to abandon operations. The option to expand capacity benefits more significantly the supplier compared to the retailer. Finally, we consider the decisions of a vertically integrated firm showing the gains from vertical integration and demonstrating that the optimum vertically coordinated production can be achieved in the decentralized multiperiod setup through a combination of a fee per product and revenue sharing.
publishDate 2023
dc.date.none.fl_str_mv 2
2023-01-01
2023
2023-01-01
dc.type.none.fl_str_mv Article
http://purl.org/coar/resource_type/c_6501
VoR
http://purl.org/coar/version/c_970fb48d4fbd8a85
dc.type.openaire.fl_str_mv info:eu-repo/semantics/article
format article
dc.identifier.none.fl_str_mv https://ddd.uab.cat/record/288114
https://dx.doi.org/urn:doi:10.1016/j.ijpe.2023.108845
url https://ddd.uab.cat/record/288114
https://dx.doi.org/urn:doi:10.1016/j.ijpe.2023.108845
dc.language.none.fl_str_mv Inglés
eng
language_invalid_str_mv Inglés
language eng
dc.rights.none.fl_str_mv open access
http://purl.org/coar/access_right/c_abf2
https://creativecommons.org/licenses/by-nc-nd/4.0/
dc.rights.openaire.fl_str_mv info:eu-repo/semantics/openAccess
rights_invalid_str_mv open access
http://purl.org/coar/access_right/c_abf2
https://creativecommons.org/licenses/by-nc-nd/4.0/
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.source.none.fl_str_mv reponame:Dipòsit Digital de Documents de la UAB
instname:Universitat Autònoma de Barcelona
instname_str Universitat Autònoma de Barcelona
reponame_str Dipòsit Digital de Documents de la UAB
collection Dipòsit Digital de Documents de la UAB
repository.name.fl_str_mv
repository.mail.fl_str_mv
_version_ 1869425234578243584
score 15,301629

Registos relacionados