Highlights We consider a three-tier supply chain selling two quality-differentiated products; The supply chain consists of a manufacturer, two retailers, and two suppliers. The manufacturer’s (either forward or backward) integration strategy is examined; Endogenous quality positioning changes the manufacturer’s integration strategy; We discuss effects of up(down)stream supply chain structure on integration strategy.

    Abstract We develop game-theoretic models to examine the manufacturer’s vertical integration strategies in a three-tier supply chain with two suppliers, one manufacturer, and two retailers. The supply chain sells two quality-differentiated products. We find that when quality is exogenous, regardless of the existing supply chain structure, the manufacturer’s choice of forward or backward integration strategy depends on the relative efficiencies of two products. When quality is endogenous, however, the existing supply chain structure does affect the manufacturer’s integration strategy decision. Although backward integration hurts the unintegrated supplier, forward integration can lead to a win-win outcome for the manufacturer and unintegrated retailer.


    Access

    Check access

    Check availability in my library

    Order at Subito €


    Export, share and cite



    Title :

    Manufacturer’s vertical integration strategies in a three-tier supply chain


    Contributors:
    Li, Wei (author) / Chen, Jing (author)


    Publication date :

    2020-02-12




    Type of media :

    Article (Journal)


    Type of material :

    Electronic Resource


    Language :

    English




    Integrated avionic strategies - an airframe manufacturer's viewpoint

    Potocki De Montalk, J. P. / Large, A. | British Library Conference Proceedings | 1994


    Electric System Integration: The Engine Manufacturer's Perspective

    Lannan, R. / Kleine, R. / SAE | British Library Conference Proceedings | 1996


    Electronic Systems Integration: The Engine Manufacturer's Perspective

    Kleine, Richard E. / Lannan, Ronald B. | SAE Technical Papers | 1996


    The Supply Chain Integration: Linking Business Goals to Supply Chain Strategies

    Kowalski, J. / Society of Automotive Engineers | British Library Conference Proceedings | 2000


    Systems engineering and supply - a vehicle manufacturer's perspective

    Haywood, S. | British Library Conference Proceedings | 2002