Collaborative Promotions: Optimizing Retail Supply Chains with Upstream Information Sharing

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Springer Science & Business Media, Aug 19, 2010 - Business & Economics - 153 pages
Promotions are at the same time beloved and feared by both food retailers and branded goods manufacturers in today’s retail environment. Beloved because they attract smart customers and generate an immediate effect on a brand’s sale. Feared because there is uncertainty about the competitors’ behavior and the actual customer demand leading to high forecast errors. For the retailer, this results in a doom loop of over- or understocking with high inventory costs in the supply chain. Collaboration between retailers and the manufacturer disentangles the doom loop. The thesis reveals the appropriate kind and timing of information and develops a so called Competition Index. Inventory in the supply chain is eliminated and the customer is served better at a lower price. Based on a joint inventory and pricing model and an empirical analysis, it shows that the supply chain efficiency gains from collaborative promotions result in a win for customers, retailers and the manufacturer.
 

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Contents

Chapter 1 Introduction
1
Chapter 2 Promotions and Collaboration in Retailing
5
Chapter 3 Literature Review
17
Chapter 4 Retailer Competition
41
Chapter 5 Empirical Analysis
99
Chapter 6 Conclusion and Managerial Insights
127
Appendix A Proofs and Calculations
131
References
149
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