DocumentCode
2336321
Title
The effects of demand referral on the inventory levels in multi-channel distribution systems
Author
Li, Hainan ; Li, Yibin
Author_Institution
Sch. of Manage., Huazhong Univ. of Sci. & Technol., Wuhan
fYear
2009
fDate
25-27 May 2009
Firstpage
1712
Lastpage
1715
Abstract
In a setting a supplier selling directly to the end customers by her wholly-owned Internet online channel, as well as a traditional physical retail channel, the supplier may refer her customers to the retailer (demand referral) when out of stock where the supplier stocks only for the online customers. The retailer pays for the excess demand of the supplier and the excess customers have a substitution rate to the retailer. We explore the impact of the demand referral (DR) on the multi-channel distribution systems. The results show that when the price of DR is predetermined by negotiation the use of DR increases the base-stock level of the retailer but decreases the base-stock level of supplier in competitive setting. Therefore, DR improves the efficiency of the global supply chain compared with understock of the retailer in traditional supply chain. Finally, numerical experiment is used to illustrate the results of this paper.
Keywords
goods distribution; inventory management; retailing; supply chain management; Internet online channel; base-stock level; demand referral; inventory level; multichannel distribution systems; online customers; physical retail channel; Contracts; Costs; Electronic commerce; Electronic mail; Internet; Inventory management; Manufacturing; Supply chains; Technology management; Uncertainty; Demand referral; Electronic Commerce; Inventory management; Supply chain management; multi-channel distribution;
fLanguage
English
Publisher
ieee
Conference_Titel
Industrial Electronics and Applications, 2009. ICIEA 2009. 4th IEEE Conference on
Conference_Location
Xi´an
Print_ISBN
978-1-4244-2799-4
Electronic_ISBN
978-1-4244-2800-7
Type
conf
DOI
10.1109/ICIEA.2009.5138488
Filename
5138488
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