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This paper aims to study the preferences of the supply chain (SC) members on various power structures under demand information asymmetry considering competing retailers.
Abstract
Purpose
This paper aims to study the preferences of the supply chain (SC) members on various power structures under demand information asymmetry considering competing retailers.
Design/methodology/approach
A two-level SC with one manufacturer and two retailers is designed. The retailers are in Bertrand competition. The manufacturer who holds the confidential demand information chooses the appropriate information sharing (IS) format. Three IS formats are provided, i.e. no IS (the manufacturer never shares with the retailers), partial IS (the manufacturer shares with one retailer), full IS (the manufacturer shares with all retailers). In addition, the authors model two power structures based on the decision sequences in the SC, i.e. retailers or manufacturer-dominant SC. The authors characterize the equilibrium solutions and payoffs and then investigate the members’ preferences for IS formats.
Findings
It is shown that in retailers (manufacturer)-dominant SC, the retailers prefer full (no) IS, but the manufacturer prefers no (full) IS. Moreover, the authors analyze the members’ preferences on power structures under demand information asymmetry, which has a relationship with the degrees of demand uncertainty and competition intensity.
Originality/value
The analysis regarding the preferences of the SC members on power structure under demand information asymmetry provides valuable managerial insights to enhance cooperation and achieve a win-win result.
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This paper focuses on the role of manufacturer brands for resellers within retail channels. This topic is important because of the strategic value of manufacturer brands and the…
Abstract
This paper focuses on the role of manufacturer brands for resellers within retail channels. This topic is important because of the strategic value of manufacturer brands and the increasing influence of resellers within channels of distribution. Much of the branding research emphasizes a customer-brand knowledge perspective; however, emerging perspectives suggest that brands are also relevant to other stakeholders including resellers. In contrast, channels research recognizes the manufacturer sources of market power, but does not consider the impact of manufacturer “push and pull” strategies within channels. Existing theoretical frameworks, therefore, do not address the reseller perspective of the brand. As a result, the research approach is a multi-method design, consisting of two phases. The first phase involves in-depth interviews, allowing the development of a conceptual framework. In the second phase, a survey of supermarket buyers on brands in several product categories tests this framework. Structural equation modeling analyzes the survey responses and tests the hypotheses. The structural model shows very good fit to the data with good construct validity, reliability, and stability. The findings show that manufacturer support, brand equity, and customer demand reflect the manufacturer brand benefits to resellers. A key contribution of this research is the development of a validated scale on manufacturer brand benefits from the point of view of a reseller. This research shows that the resources that relate to the brand, not just the brand name itself, create value for resellers in channel relationships.
James Langenfeld and Brad Noffsker
In a number of recent multi-billion dollar cases brought against cigarette manufacturers, plaintiffs have in part alleged that the cigarette manufacturers (1) conspired not to…
Abstract
In a number of recent multi-billion dollar cases brought against cigarette manufacturers, plaintiffs have in part alleged that the cigarette manufacturers (1) conspired not to compete on the basis of health claims or the introduction of potentially safer cigarettes since the 1950s, and (2) engaged in fraudulent advertising by making implied health claims in advertisements selling ‘low tar’/‘light’ cigarettes. In this type of litigation, defendants’ actions could be due to alleged illegal behaviour as asserted by plaintiffs, or be the result of market forces that may have nothing to do with allegedly inappropriate acts. We examine the economic evidence relating to these allegations, taking into account some of the major influences on cigarette company behaviour. In particular, our analyses show that much of the cigarette manufactures’ behaviour can be explained by Federal Trade Commission and related government actions, rather than conspiracy or fraudulent acts. We find the economic evidence is inconsistent with an effective conspiracy to suppress information on either smoking and health or the development and marketing of potentially safer cigarettes. Regarding ‘lower tar’ and ‘light’ cigarettes, the economic evidence indicates that the cigarette manufacturers responded to government and public health initiatives, and that disclosing more information on smoking compensation earlier than the cigarette companies did would not have had any significant impact on smoking behaviour.
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Paul Matthyssens, Koen Vandenbempt and Sara Weyns
Manufacturers increasingly seek new ways to add customer value and differentiate. However, in business markets such efforts often remain relatively unsuccessful, leading to a…
Abstract
Manufacturers increasingly seek new ways to add customer value and differentiate. However, in business markets such efforts often remain relatively unsuccessful, leading to a large number of services offered and higher costs, but with limited corresponding returns. Based on extensive expert interviews and case study research, this paper studies how suppliers in the highly commoditized metalworking industry try to realize new types of customer value. The paper identifies “ideal” value positions pursued by Belgian contract manufacturers and service providers in order to survive in an industry characterized by fierce price competition from low labor cost countries. Further, the paper shows how companies can migrate to these “ideal” value offerings. Key success factors and potential traps for each ideal type are identified. Market strategy transition necessitates an internal “alignment” strategy and an external “coevolution” with chain partners.
Abstract
Purpose
The managerial questions of this paper are as follows, and the authors are trying to solve them: How revenue sharing contract (CSR) degree and government subsidy affect the agri-food quality? What kind of model (WPC, revenue-sharing contract [RSC] and cooperative) would be more effective in motivating manufacturers and retailer to increase effort and improve agri-food quality? What kind of model (WPC, RSC and cooperative) would make manufacturer and retailer better off?
Design/methodology/approach
Considering the jointing quality effort and contract decision in green agri-food supply chain, this paper proposes six models that consider CSR of manufacturer and retailer, and then the obtained optimal solutions are compared and analyzed. At the same time, the impact of government subsidies is analyzed, and corresponding conclusions are drawn.
Findings
The results show that, first of all, whether the increasing CSR of the manufacturer or the retailer can motivate both parties to improve the agri-food quality effort investment. Second, the WPC and RSC contract may play different role in different cases. Finally, under the model with government subsidies, regarding positive influence of government subsidies on efforts of manufacturer and retailer, quality and profits of members is investigated. Based on these conclusions, this study puts forward the following policy suggestions. Firstly, governments should formulate reasonable subsidy policies to support manufacturer and retailer to improve the agri-food quality, thereby promoting green industries' development. Secondly, manufacturer and retailer should actively improve CSR and strengthen the effort of agri-food so as to advance quality. Finally, manufacturer and retailer can choose cooperative model or WPC contract.
Research limitations/implications
In this paper, one manufacturer and one retailer are considered. Since the agri-food supply chain structure in reality is more complicated, the future research direction can consider the supply chain structure with one manufacturer and multiple retailers. In addition, this paper only considers the subsidy, and future research can classify the subsidy into different types.
Originality/value
The study makes two substantive contributions to the body of knowledge in the field of sustainable operations:(1) incorporating quality-based demand function in supply chain and dynamic process of agri-food quality; (2) exploring the impact of CSR awareness of members and subsidy of government on agri-food quality, and comparing the influence in different models.
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Roger D. Blair and Jill Boylston Herndon
In United States v. United Shoe Machinery Corp., United Shoe Machinery (USM) was found guilty of illegal monopolization due to its leasing practices. Existing scholarship on this…
Abstract
In United States v. United Shoe Machinery Corp., United Shoe Machinery (USM) was found guilty of illegal monopolization due to its leasing practices. Existing scholarship on this case largely focuses on the issue of leasing versus selling. In this article, we provide a more comprehensive analysis of this important decision. In addition, we examine USM’s antitrust experience before and after the famous 1953 case. We find that USM’s business practices were largely procompetitive and, therefore, did not warrant condemnation.
Abstract
Purpose
Promoting electric vehicles (EVs) is an effective way to achieve carbon neutrality. If EVs are widely adopted, this will undoubtedly be good for the environment. The purpose of this study is to analyze the impact of network externalities and subsidy on the strategies of manufacturer under a carbon neutrality constraint.
Design/methodology/approach
In this paper, the authors propose a game-theoretic framework in an EVs supply chain consisting of a government, a manufacturer and a group of consumers. The authors examine two subsidy options and explain the choice of optimal strategies for government and manufacturer.
Findings
First, the authors find that the both network externalities of charging stations and government subsidy can promote the EV market. Second, under a relaxed carbon neutrality constraint, even if the government’s purchase subsidy investment is larger than the carbon emission reduction technology subsidy investment, the purchase subsidy policy is still optimal. Third, under a strict carbon neutrality constraint, when the cost coefficient of carbon emission reduction and the effectiveness of carbon emission reduction technology are larger, social welfare will instead decrease with the increase of the effectiveness of emission reduction technology and then, the manufacturer’s investment in carbon emission reduction technology is lower. In the extended model, the authors find the effectiveness of carbon emission reduction technology can also promote the EV market and social welfare (or consumer surplus) is the same whatever the subsidy strategy.
Practical implications
The network externalities of charging stations and the subsidy effect of the government have a superimposition effect on the promotion of EVs. When the network effect of charging stations is relatively strong, government can withdraw from the subsidized market. When the network effect of charging stations is relatively weak, government can intervene appropriately.
Originality/value
Comparing previous studies, this study reveals the impact of government intervention, network effects and carbon neutrality constraints on the EV supply chain. From a sustainability perspective, these insights are compelling for both EV manufacturers and policymakers.
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Hung Nguyen, George Onofrei, Ying Yang, Kevin Nguyen, Mohammadreza Akbari and Hiep Pham
The manufacturing investment shift from developed countries to emerging and developing regions creates further needs for identifying appropriate green certification strategies…
Abstract
Purpose
The manufacturing investment shift from developed countries to emerging and developing regions creates further needs for identifying appropriate green certification strategies. This study proposes that alignments between green certification practices (GCRs) and process innovation (PIN) could help identify appropriate strategies that national economic development can influence.
Design/methodology/approach
Drawing on the diffusion of innovation theories, this study proposed a taxonomy to examine whether sustainable performance differs depending on the levels of alignment and the role of national economic development. The study uses an empirical survey approach to highlight alignments between GCRs and PIN among developed, developing and emerging economic nations, addressing resource allocation for the world's sustainable development goals (SDGs).
Findings
Manufacturers need to align PIN practices with the level of green certification to achieve sustainable performance. Manufacturers experiencing higher payoffs from various improvements successfully align in GCR and PIN. The alignment between these two concepts can derive different taxonomies, which highlight performance and managerial implications for manufacturers. The manufacturers followed three distinct typologies: minimalist, process active and proactive. Besides, building on the theory of performance frontiers, the findings indicated that manufacturers in developing and emerging economies placed the most substantial GCR effort compared to their counterparts in developed nations. Manufacturers in developed countries are increasingly reaching the “diminishing points” and investing limited resources in GCR just enough to keep their competitive positioning as order qualifiers rather than order winners. Developing economies are catching up very quickly in attaining GCRs and business performance.
Research limitations/implications
This insight is essential for managers to adapt to nations' economic development conditions and appropriately and effectively align resources.
Practical implications
The findings offer a decision-making process and provide straightforward guidelines for supply chain managers' green certification adoption.
Originality/value
In including both PIN and green certification, this paper adds greater comprehensiveness and richness to the supply chain literature.
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Frank Germann, Ronald L. Hess and Margaret G. Meloy
Prior research has documented that product failures can be among a firm's worst nightmares. In this research, we examine if retailers are also held accountable by consumers when…
Abstract
Prior research has documented that product failures can be among a firm's worst nightmares. In this research, we examine if retailers are also held accountable by consumers when products that they sold, but did not manufacture, fail. In two studies, we show that consumers not only blame multiple parties when product failures occur – including the retailer – but also that manufacturer brand equity and retailer store image serve as important contextual cues in the blame assignment process. Specifically, building on congruity theory, we show that retailers are especially susceptible to being held responsible for failure if the equity of the failed product and the retailer store image are incongruent. Our findings also indicate that value-oriented retailers are particularly vulnerable to being blamed when high-equity products fail. Our findings suggest measuring attribution of blame between the manufacturer and retailer involved in a product failure event – instead of only the manufacturer as has been the norm in extant research – facilitates our understanding of consumer responses when product failures occur.
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