Information Leakage And Information Alignment Strategies Of A Dominant Retailer In Supply Chain

With the unprecedented progress of information technology,information resource has increasingly become a type of essential production factor,intangible asset and social wealth.Large-scale retailers have more comprehensive and accurate information about market demand than do any of the other participants.They have surpassed the suppliers and gradually occupied the dominant position in supply chains.Therefore,in the context of retailer’s dominating the supply chain,the information leakage and information alignment strategies are systematically researched with great significance.This dissertation pursues an in-depth study on information leakage and information alignment strategies in a supply chain with a dominant retailer by applying game theory,principle-agent theory and optimality theory synthetically.The specific research content as follows:Firstly,information leakage and prevention mechanism of a dominant incumbent retailer is investigated.Consider a supply chain with a dominant incumbent retailer,an upstream supplier and a vulnerable entrant retailer.The dominant retailer has private market demand information and plays a leading role.Under a wholesale price contract,by investigating scenarios without and with information leakage,analytical solutions are obtained,and all participants’ profits are compared.Then,in an environment with greater market demand fluctuation,the dominant retailer provides a wholesale price contract with a breach penalty to prevent supplier’s information leakage effectively.Furthermore,by comparing these two types of contracts,the participants’ optimal strategies and some meaningful insights into driving practical management behaviours are received.Secondly,information sharing and information concealment of a dominant incumbent retailer is investigated.Consider a supply chain comprising a dominant incumbent retailer,who knows the terminal market demand as private information and is entitled to dictate wholesale price while competing in terms of quantity with a weaker entrant retailer,and a common upstream supplier.Analyses of Stackelberg games corresponding to two strategies,i.e.,information sharing and information concealment,reveal all participants’ decisions and their profits.And then,the parameters are discussed.The influencing factors about decisions and profits are obtained by comparing analytical solutions and numerical experiments.Moreover,further discussions about the difference of all participants’ profits under two strategies,and certain conditions for which strategy outperforms the other are provided.Finally,the supplier’ s information alignment when facing a dominant entrant retailer is investigated.Considering a typical two-tier supply chain,discuss the information strategy for the supplier of either aligning with the dominant entrant retailer,i.e.,leaking the incumbent’s demand information to the entrant,or aligning with the vulnerable incumbent retailer,i.e.,concealing that information from the entrant.The results reveal that all participants’ preferences depend on subtle considerations of multiple factors.Through further discussions of the participants’ equilibrium strategies,the dominant strategy and some useful managerial insights derived from analytical and computational analyses.