Journal Article

Share or not share: the optimal logistics service strategy in a dual-channel e-commerce supply chain

2024

Overview

In practice, many large e-tailers share their logistics service with others, which makes a new trend of logistics service sharing (LSS) emerge. To explore the effects of LSS on firms in the dual-channel supply chain, we propose an analytical model consisting of a manufacturer and an e-tailer and further study the effects of LSS on firms’ decisions and profits. Our results show that the effects of LSS depend on the manufacturer’s logistics service disadvantage and the logistics service cost difference between the manufacturer and e-tailer. Surprisingly, we find that the manufacturer will be worse off from LSS when its logistics disadvantage is sufficiently large due to the loss of wholesale profit. However, the e-tailer can benefit from LSS when the manufacturer’s logistics service disadvantage is relatively small, or the manufacturer’s logistics service disadvantage is moderate but the logistics service cost difference is small. Moreover, such sharing can achieve a win–win situation only when the manufacturer’s logistics service disadvantage is extremely small and the logistics service cost difference is large. Finally, from the perspective of maximizing the performance of the supply chain, we explore the optimal logistic service sharing strategy, and further design a contract to encourage all supply chain members to join such sharing.

• Publisher: Springer Nature B.V
• Subject: Cost benefit analysis / Electronic commerce / Logistics / Optimization / Supply chains