Study On Ordering Decision In A Supply Chain With Strategic Demand Information Sharing

With the continuous improvement of information technology and rapid development of economic integration,the competition between enterprises has gradually developed into the competition between supply chains.Considering upstream and downstream enterprises are independent individuals,different members play different roles in the supply chain,they are owned with different types of private information and have different capabilities to acquire the private information.It is significant in supply chain operation management to timely acquire more accurate information and promote efficiently information sharing among supply chain members.The retailers are closer to the selling market and better know ing the consumer demand.Therefore,they have an information advantage compared with other members.Retailers in different competitive environments will hide their private demand information for the protection of information advantages and profits,which arises information asymmetry,and cause bullwhip effect,which results in a serious mismatch between supply and demand.Thus,the supply chain efficiency and enterprise performance are reduced and market competitiveness of the supply chain is weakened.Information sharing is an effective way to overcome information asymmetry,decreases bullwhip effect,and realize coordination in a supply chain.However,in the complex business environment,the communication between enterprises is always unverifiable,noncontractible,and informal.There exists lots of false information and information leakage,which further impedes the efficient information sharing.It is an urgent problem for enterprises to discuss the information sharing strategy and design an incentive mechanism to promote efficient information sharing in a supply chain.Therefore,this paper combines the communication and sharing process of demand information in the operation of supply chain members,studies the ex post information sharing strategy of a senior retailer with demand information advantage in the contex ts of upstream competition,downstream competition,and upstream and downstream competition by using related methods of game theory and supply chain operation management.We first assume that the senior retailer always has information advantage and complet e demand forecasting ability,and then extend to incomplete demand forecasting ability,discusses the updating methods of demand information under different information strategies.Further we consider the impact of the information acquisition capability on the information sharing strategy when the senior retailer is owned with information advantage under a certain probability.The main researches are as follows:First,we investigate the information sharing strategy and order decisions in the supply chain with upstream supply competition.Two suppliers provide different products to the common retailer.Under the uncertain market demand,the retailer with complete information forecasting ability can obtain demand information before the sales season and decide whether to share his private information with the suppliers.Assume that the information is truthfully shared,we construct Stackelberg models to analyze the optimal operation decisions of the two suppliers and the retailer under three scenarios(no information sharing,information sharing with only one supplier,and information sharing with both suppliers).By comparing operation decisions and the profits of three sharing models,we obtain the ex post demand information sharing incentive and strategy of the retailer.It shows that the retailer is willing to share a low demand state with the supplier(s)rather than a high demand state.When the value of information sharing is high,the supplier(s)can use side-payment contracts to encourage the retailer to share the high demand information.Second,we study the information acquisition and sharing strategy in the supply chain with downstream retail competition.Under the uncertain market demand,we analyze the information-updating model by using Bayes theorem when the senior retailer is owned with incomplete information forecasting ability.We discuss the supplier’s wholesale price decision and the retailers’ order quantities decisions under the strategies of information acquisition,sharing and leakage.By co mparing the profits of different information decisions,we obtain the information leakage strategy of the supplier and the information acquisition condition and sharing strategy of the senior retailer.In addition,we discuss the effect of the supplier’s ability to observe the senior retailer’s information acquisition behavior on each member’s information strategies.It shows that the supplier always leaks the senior retailer’s private information to the entrant retailer.of each member.Whether the supplie r can observe the senior retailer’s information acquisition behavior has a significant impact on the information acquisition and sharing decisions.Third,we study the information sharing strategy by using “cheap talk” in the supply chain with downstream r etail competition and upstream capacity constraint.The demand message that the senior retailer sends to other supply chain members is unconstrained,unverifiable and noncontractible.We respectively discuss the Stackelberg models among supply chain member s under no information sharing,horizontal information sharing,and public information sharing,solv ing the optimal operation decisions of each member in the supply chain,and analyze the effect of capacity constrain and allocation strategy on the operatio n decisions.By constructing the incentive compatibility constraint conditions,we discuss the information sharing strategies of the senior retailer under two sharing mode ls and obtain the conditions for achieving meaningful information sharing equilibrium.Further,we study the effect of this equilibrium on the profits of each member and the supply chain.It shows that if the information is only shared between the retailers,the senior retailer always has an incentive to deflate his demand information to m islead the entrant retailer to order less.The meaningful information sharing cannot be achieved.However,when the information is also shared with the supplier,the incumbent retailer would face a trade-off between the desire to receive more products and the fear of intense competition and a higher wholesale price.This trade-off leads to a meaningful information sharing equilibrium.Fourth,we study the information sharing strategy of the retailer with incomplete information acquisition capability and order decisions under random demand with the potential supplier encroachment.To earn more profits,the supplier may build online channel to sell the product directly to consumers.The encroachment causes the competition between the supplier and the retailer.We discuss the optimal wholesale prices and orders under four scenarios,which is no encroachment with and without information sharing,and encroachment with and without information sharing.Then by comparing the retailer’s profits,we obtain the information sharing equilibrium of the retailer.It shows that a higher information acquisition capability always makes the supplier better off,but it is not always beneficial for the retailer,therefore,the retailer is not willing to improve and get perfect information acquisition capability even though it is costless.The supplier encroachment may benefit the retailer,does not affect the information sharing strategy.