A delayed demand supply chain: Incentives for upstream players

Hosoda, Takamichi and Disney, Stephen Michael ORCID: https://orcid.org/0000-0003-2505-9271 2012. A delayed demand supply chain: Incentives for upstream players. Omega 40 (4) , pp. 478-487. 10.1016/j.omega.2011.09.005

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Abstract

We study a decentralized supply chain where only delayed market demand information is available for making replenishment decisions. The impact of this delay is quantified in a serially linked two-level supply chain where each player exploits the order-up-to replenishment policy. The market demand is assumed to be a first-order autoregressive process. It is shown that the first level of the supply chain benefits from shorter time delays; however, the benefit for the second level is quite minor at best and can sometimes even be (counter-intuitively) detrimental. We conclude that the second level does not have a strong incentive to reduce the time delays in the shared market demand information.

Item Type:	Article
Date Type:	Publication
Status:	Published
Schools:	Business (Including Economics) Centre for Advanced Manufacturing Systems At Cardiff (CAMSAC)
Subjects:	H Social Sciences > H Social Sciences (General) H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Uncontrolled Keywords:	Information delay; Inventory; Manufacturing; Order-up-to policy; Stochastic process; Supply chain management; Time series; RFID
Publisher:	Elsevier
ISSN:	0305-0483
Date of First Compliant Deposit:	27 July 2016
Last Modified:	22 Nov 2024 05:45
URI:	https://orca.cardiff.ac.uk/id/eprint/19011

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