Value of information sharing in supply chain under promotional competition

In this paper, the value of information sharing is measured in a two-stage supply chain consisting of a manufacturer and two retailers. These retailers compete in a market with multiple customer segments, including loyal, switching, and stockpiling ones, by using a promotional pricing strategy. With this setting, the differences in total supply chain profits are quantified under no information sharing, and information sharing with and without disclosure agreements. It is found that while sharing information with a nondisclosure agreement is always valuable, this might not be the case for a disclosure one. In addition, the conditions, where information sharing with the disclosure agreement is beneficial, have been analytically determined. Then, the measurements of information sharing value under varying model parameters are explored, both numerically and analytically. The results provide useful managerial insights on when an information sharing agreement offers the most benefits.

Automated summary

This paper examines the value of information sharing in a supply chain, comparing the differences in total supply chain profits under different scenarios. It finds that the impact of different information sharing agreements on the value of the supply chain varies.