Supply chain management and the Internet: Transaction and product distribution efficiencies

The emergence of the Internet may have fundamentally altered the mechanisms underlying the exchange of goods and information between sellers and end consumers. However, very few academic works have considered the impact these mechanisms have on the efficiency of supply-chain operations. This dissertation addresses this deficiency in the literature by evaluating supply-chain transaction efficiency and product-distribution efficiency effects obtained from Internet-based purchases by end consumers.; The dissertation develops and empirically tests a theoretical framework that examines the role Internet-based purchases by end consumers have on the levels of transaction and product-distribution efficiency exhibited by product exchanges between sellers, placed at different echelons of the supply chains, and end consumers. The theoretical framework integrates previous research findings from the Transaction-Cost Economics, Internet Economics, Channel Management, Inter-Organizational Information Systems, Supply Chain Management, and Logistics Management literature.; The empirical analysis pertaining to the theoretical framework's transaction-efficiency component is based on archival data in the Internet music-CD market. The statistical analysis in this portion of the model uses Structural Equation Modeling. On the other hand, the empirical analysis pertaining to the theoretical framework's product distribution efficiency component uses a simulation model defined by supply chain management practices in the Internet book market. The statistical analysis in this portion of the model comprises Ordinary-Least-Squares Regression, Structural Equation Modeling, and Pair-Wise T-Tests.; The results from the first empirical analysis component show that Internet-mediated purchases by end consumers allow for greater transaction efficiencies, as the supply chain distance between the end consumer and the echelon from where the purchased item is sourced increases. The results also suggest that channel structure configuration, defined by the supply chains' Internet retailing echelon, moderates these transaction efficiency effects. The second part of the empirical analysis shows that statistical and scope economies—determined by the consolidation of inventory—and scale economies—determined by the level of product demand—lead to improvements in supply-chain distribution efficiency. These effects are present across multiple distribution and inventory location postponement policies in the supply chain. However, scale economy effects on distribution efficiency are relatively higher under direct distribution and inventory location speculation policies.