Research On Operation And Coordination Of Supply Chain In A Gray Market Setting

Gray markets,also known as parallel imports,refer that the brand name products are resold to another country by distributors through the informal sales channels without the consent of the intellectual property rights owner.In reality,when observing the price difference across regions,some authorized or unauthorized distributors may resale the brand name products to the high-price market for arbitraging.The resold products can be called as gray market goods.The unauthorized distributor can be called as independent speculator,and the authorized distributor can be called as the gray marketer.The existing research,which assume that gray market goods are resold by an independent speculator,are studying gray markets only from the perspective of single multinational firm but not from the perspective of decentralized supply chain.The existing research,which assume that gray market goods are resold by an authorized distributor,are studying gray markets only from the perspective of the simultaneous-decision.In addition,a recent survey by KPMG revealed that not only independent speculator but also authorized distributor participate in gray market.In view of the deficiency of existing literature,three situations are considered here from supply chain perspective:(a)only the independent speculator can participate in gray market;(b)only the authorized distributor can participate in gray market;(c)the two kinds of gray marketers participate in gray market.The paper constructs a Stackelberg model where the authorized distributor is the leader and the unauthorized distributor is the follower,and investigates the optimal operational decision of each player and the corresponding coordination mechanism in a gray market setting.This paper on gray markets includes the following three aspects:Firstly,under the situation(a),this thesis analyze the pricing strategies and the corresponding coordination mechanisms of a decentralized supply chain model.It established a three-stage Stackelberg model,which consists of one manufacturer,two distributors in different countries and one independent speculator.In the market,where gray market goods flowed to,the authorized distributor is the leader and the independent speculator is the follower.By using a backward manner,the dissertation derives the optimal wholesale prices of the manufacturer,the optimal order quantities of the distributors and the independent speculator in the decentralized setting.Furthermore,two expansion models(two half-decentralized systems),in which the manufacturer sells products in one of the markets directly,are considered by this paper.The differences between this paper and the existing research is that: this paper which assume that only the independent speculator can participate in gray market,is from the perspective of the decentralized supply chain,but not from the view of single multinational firm.Secondly,under the situation(b),the paper considers the authorized and unauthorized distributors making decision sequentially,and derives the equilibrium strategy and the corresponding coordination mechanism of a decentralized supply chain model.In view of the common problem that the existing studies pay little attention to the different market powers between the authorized and unauthorized distributors,this thesis consider a global supply chain composed of one manufacturer and two distributors in different countries,and assume that one of the distributors is the gray market entrant.It constructs a Stackelberg model where the authorized distributor is the leader and the unauthorized distributor is the follower.By using a backward manner,the dissertation derives the optimal wholesale prices of the manufacturer,the optimal order quantities of the two distributors in the decentralized setting.Then,it introduces the two-part tariff contract to coordinate the supply chain in a gray market setting.Furthermore,one expansion model(a half-decentralized system),in which the manufacturer directly sells products in the market where the gray market goods flowed to,is considered by this paper.The differences between this paper and the existing research is that: this paper which assume that only the authorized distributor can participate in gray market,considers the authorized and unauthorized distributors making decision sequentially but not simultaneously.Finally,under the situation(c),this thesis analyze the pricing strategies and the corresponding coordination mechanisms of a decentralized supply chain model.In view of the phenomenon that,the two kinds of gray marketers participate in gray market,this thesis establish a three-stage model which consists of one manufacturer,two distributors and one independent speculator.By using a backward manner,the dissertation derives the optimal wholesale price of the manufacturer,the optimal order quantities of the two distributors and the independent speculator in the decentralized setting.Then,it investigates the corresponding coordination mechanism of the supply chain in a gray market setting.Furthermore,one expansion model(a half-decentralized system),in which the manufacturer directly sells products in the market where the gray market goods flowed to,is considered by this paper.The differences between this paper and the existing research is that: the existing research only considered one kind of gray marketer can participate in gray market,but this paper considered that the two kinds of gray marketer can participate in gray market.