The Study About Cost-Benefit Of E-Commerce Joint Purchasing

The development of the E-commerce make the feasibility of joint procurement increased for the enterprises. E-commerce joint procurement can bring those superiorities for the enterprises:decision priority, lower operating costs and wholesale discount. Meanwhile, E-commerce joint procurement need some joint procurement costs. This paper considers joint procurement costs, discuss what effect will be bring to supply chain members from the advantages of the joint procurement, discuss how the lower rate of operating costs affect wholesale discount.First supply chain contain supplier and n retailers game with joint procurement is modeled. Different profit of supply chain members because of different decision priority is discussed. The effect of lower operating costs to the profit of supply chain is discussed too. The paper discusses the decision problem of whether the enterprise joint procurement in different costs. The results show that, let supplier decision the wholesale at first, then decision order quantity by purchasing alliance, non-alliance members making order quantity at last, which is the best optimal sequence of decisions. The reducing operating costs brought by joint procurement which is contribute to alliance members, suppliers and supply chain. In most cases, the profits of non-alliance members will decrease. There are two thresholds joint costs. When the cost larger than the bigger thresholds, anyway, joint purchasing should not be done for the benefits. When the cost less than the littler thresholds, anyway, joint purchasing should be done for the benefits.Then the paper discussed about the role of wholesale discounts on joint procurement, and the wholesale decision. The results show that the profits of alliance will increasing with the rate of wholesale discount increased at first, then the situation will become the opposite. Existing the optimal wholesale discount rate which makes the profit of alliance maximum, which rate is Inverse with the rate of operating costs reduce, but direct ratio with the number of non-alliance members. The latter make greater impact on the optimal discount rate than the former. When the number of retailers which joint purchasing less than a half of the number of all the retailers, critical wholesale discount rates is exist, when the discount rates bigger than the critical rate, the profits of Supplier will not reduce. The critical rate direct ratios with the rate of operating costs reduce.At last, based on the earlier this paper established a computational tool which could be used for decision. And the paper made a numerical example, summarized the conclusions and deficiencies of paper, forecasted follow-up study.