Analysis of Dual Sourcing Strategy with Quality Differentiated Suppliers

Co-opetition supply chain is now the normal mode of development among enterprises. Based on the co-opetition supply chain, this paper designs a model to study the procurement strategy between OEM and two suppliers with supply uncertainty. We find that the profit increase of OEM is less affected by t...

Full description

Bibliographic Details
Main Author: Zhao Shuang
Format: Article
Language:English
Published: EDP Sciences 2021-01-01
Series:E3S Web of Conferences
Online Access:https://www.e3s-conferences.org/articles/e3sconf/pdf/2021/29/e3sconf_eem2021_01057.pdf
Description
Summary:Co-opetition supply chain is now the normal mode of development among enterprises. Based on the co-opetition supply chain, this paper designs a model to study the procurement strategy between OEM and two suppliers with supply uncertainty. We find that the profit increase of OEM is less affected by the wholesale price of a single supplier when purchasing through a single channel suppress. The dual purchase strategy has a great advantage, which leads to price war and reduces wholesale price. However, it is interesting to find that when the technical level of competitive suppliers is constantly improving, the order quantity of competitive suppliers is not always rising, but presents a single peak mode. This shows that OEM can deal with the threat of profit by reducing the orders to competitive suppliers.
ISSN:2267-1242