Should suppliers allow capacity transfers?

Neda Khanjari, Izak Duenyas*, Seyed M.R. Iravani

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

This research considers situations in which buyers pay to reserve their suppliers' capacity for future use. The study specifically explores whether suppliers should provide transfer rights, allowing buyers unable to use all of their reserved capacity to transfer the excess to another buyer, and whether they should charge a transfer fee. The study finds that, in most cases, the supplier maximizes financial outcomes when the buyer releasing the excess capacity keeps most of the retail-level profit from the transfer and the supplier does not charge a transfer fee.

Original languageEnglish (US)
JournalProduction and Operations Management
DOIs
StateAccepted/In press - 2022

Keywords

  • buyer–supplier negotiation
  • capacity management
  • capacity transfer fees

ASJC Scopus subject areas

  • Management Science and Operations Research
  • Industrial and Manufacturing Engineering
  • Management of Technology and Innovation

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