Please use this identifier to cite or link to this item: http://hdl.handle.net/10397/28940
Title: Supplier competition in decentralized assembly systems with price-sensitive and uncertain demand
Authors: Jiang, L 
Wang, Y
Keywords: Assembly systems
Noncooperative games
Price-production decisions
Supply chain management
Issue Date: 2010
Publisher: Informs
Source: Manufacturing and service operations management, 2010, v. 12, no. 1, p. 93-101 How to cite?
Journal: Manufacturing and Service Operations Management 
Abstract: In a decentralized assembly supply chain, independent suppliers produce a set of complementary components from which an assembler assembles a final product and sells it to the market. In such a channel, several competitive forces interact with one another to affect the price and quantity decisions of the firms involved. These include: (1) the direct competition each supplier faces for producing the same component, (2) the indirect competition among the suppliers producing the set of complementary components needed for assembling the final product, and (3) the vertical interaction between the assembler and the component suppliers. This paper shows that the direct competition that one supplier faces helps improve the performance of the assembler and all the other suppliers in the channel; and surprisingly, it can help improve the performance of this particular supplier facing the competition as well. Second, the assembler benefits from a merger of suppliers producing different components in the complementary set. Furthermore, the assembler prefers a merger of suppliers with less direct competition over a merger of suppliers with more direct competition.
URI: http://hdl.handle.net/10397/28940
DOI: 10.1287/msom.1090.0259
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