Informs 2015

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INFORMS Philadelphia – 2015
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4 - Improving Food Bank Gleaning Operations: An Application in
New York State
Erkut Sonmez, Assistant Professor, Boston College, 140
Commonwealth Ave, Fulton Hall, Chestnut Hill, 02446,
United States of America, Miguel Gomez,
Deishin Lee, Xiaoli Fan
We develop a stochastic optimization model to help food banks to improve their
gleaning operations. Gleaning refers to collecting food from what is left in the
fields after harvest, and donating the goods to food banks or pantries that service
food insecure individuals.
TA48
48-Room 105A, CC
Managing Contracts and Financial Flow in
Supply Chain
Sponsor: Manufacturing & Service Oper Mgmt/iFORM
Sponsored Session
Chair: Lingxiu Dong, Associate Professor, Washington
University in St. Louis, One Brookings Drive, St. Louis, MO, 63132,
United States of America,
1 - Buyer Intermediation in Supplier Finance
Tunay Tunca, , Weiming Zhu
We analyze the role and the efficiency of buyer intermediation in supplier
financing (BIF). We theoretically demonstrate that BIF can significantly improve
the supply chain surplus over traditional financing. Using data from a large
Chinese online retailer, we estimate model parameters, empirically verify the
theory, and predict efficiency gains.
2 - Financial Pooling in Supply Chains
S. Alex Yang, Assistant Professor, London Business School, Sussex
Place, London, United Kingdom, , Qu Qian,
Ming Hu
Trade credit pools liquidity between suppliers and retailers. Due to this pooling
effect, even if the supplier’s cost of capital is higher, the retailer may still demand
for trade credit. Supply chain finance increases the efficiency of this pooling
effect, and hence reduces the overall chain financing cost.
3 - Trade Credit and Supplier Competition
Jiri Chod, Boston College, Carroll School of Management,
Chestnut Hill, MA, S. Alex Yang,
Evgeny Lyandres
We study the effect of competition among suppliers on their willingness to
provide trade credit. Providing trade credit to a financially constrained buyer
allows this buyer to reallocate his cash budget to purchasing from competing
suppliers. Thus, relaxing the buyer’s financial constraint may backfire at the
supplier who provides financing. This is a possible explanation of the empirical
regularity that firms selling differentiated products tend to offer more trade credit.
4 - Push, Pull, and Delayed Payment Contracts when a Manufacturer
Expands His Product Line
Xiaomeng Guo, PhD Candidate, Olin Business School,
Washington University in St. Louis, Campus Box 1156, One
Brookings Drive, St. Louis, MO, 63130, United States of America,
, Lingxiu Dong, Danko Turcic
A manufacturer’s ability to sell a new product often depends on a retailer’s
willingness to stock the product. We construct a game-theoretic model of a supply
chain with stochastic, price-sensitive demand and consider three basic wholesale
price contracts: push, pull and delayed payment contracts. We show how a
manufacturer can influence the retailer’s incentive to carry a second product by
choosing a “correct” contract type and clarify which contract should be expected
in equilibrium.
TA49
49-Room 105B, CC
Uncertainty in Sourcing and Procurement
Sponsor: Manufacturing & Service Oper Mgmt/Supply Chain
Sponsored Session
Chair: Zohar Strinka, PhD Candidate, University of Michigan,
1205 Beal Ave., Ann Arbor, MI, 48109, United States of America,
1 - Supplier Diversification under Random Yield and Price
Dependent Demand
Guang Xiao, Olin Business School, Washington University in St.
Louis, St. Louis, United States of America, ,
Lingxiu Dong, Nan Yang
We consider a firm’s supply diversification problem under supply random yield
and price sensitive demand. We study two pricing schemes: responsive pricing
and ex ante pricing. We characterize the sourcing decisions under each pricing
scheme and compare them to study the strategic relation between diversification
and responsive pricing.
2 - Risk Pooling under Price and Demand Uncertainty
Refik Gullu, Professor, Bogazici University, Industrial Engineering
Dept., Bebek, Istanbul, 34342, Turkey, ,
Nesim K. Erkip
We consider purchasing and distribution decisions for a commodity whose price is
random and correlated with its demand. A model, where the purchasing decisions
of locations are pooled is proposed. We obtain the optimal purchase quantity,
time and quantity of allocation, and quantify the benefits of pooling price risk.
3 - Bunching Supply Contracts with Information Asymmetry in a
Two-echelon Supply Chain
Zahra Mobini, Erasmus University Rotterdam, Rotterdam,
Netherlands, Albert Wagelmans,
Wilco Van Den Heuvel
In a two-echelon supply chain consisting of a supplier and a retailer where the
latter has private information about his cost parameter, we analyze the design of
the supplier’s optimal menu of contracts. Instead of offering a separating menu,
the supplier offers a menu of bunching contracts where each contract is intended
to appeal to more than one retailer type. We investigate the effects of offering
such a menu on the supplier’s profit.
4 - Overstock Goods Auctions
Zohar Strinka, PhD Candidate, University of Michigan,
1205 Beal Ave., Ann Arbor, MI, 48109, United States of America,
, H. Edwin Romeijn
Manufacturers sometimes find themselves with a considerable quantity of
overstock goods. In these cases, some turn to online liquidation auctions to sell
excess inventory. We propose implementing US Treasury-style auctions in this
setting which allow bidders to specify pairs of bid price and a desired quantity at
that price. We consider bidders who are themselves retailers and face
newsvendor-type costs based on the number of units won and uncertain demand.
TA50
50-Room 106A, CC
Operations Management and Marketing Interface
Sponsor: Manufacturing & Service Operations Management
Sponsored Session
Chair: Ozge Sahin, Johns Hopkins University,
Co-Chair: Yao Cui, Cornell University, 401N Sage Hall, Ithaca, United
States of America,
1 - Econometric Models of Pairwise Externalities and Social
Attractiveness for the Music Industry
Stefano Nasini, Post-doctoral Researcher, IESE Business School,
3-7, Arnus i Gari, Barcelona, Spain,
Victor Martínez-de-Albéniz
We developed an econometric model of social attractiveness that integrates time
variation of individual decisions with the structural information concerning their
spillovers. The exponential family of distributions is used to jointly deal with the
dynamic and structural aspect of such a complex statistical setting. It resulted in a
well-suited model for the analysis of artist goods. An application to a large data
set of song diffusion on the radio is presented.
2 - Inventory Management for Luxury Goods
Ruslan Momot, INSEAD, Boulevard de Constance,
Fontainebleau, 77305, France,
Elena Belavina, Karan Girotra
Firms selling conspicuous goods face a trade-off: producing more allows for
extracting more revenues but compromises the product’s reputation for
exclusivity. We capture this trade-off in a dynamic model of strategic customer
and firm behavior that includes limited memory. Firms should follow stationary
cyclic strategies alternating scarcity and overproduction. The former builds a
reputation whereas the latter exploits it. The longer the customer memory,
shorter is the overproduction phase.
3 - A Newsvendor Model with Product Bundling
Qingning Cao, University of Science and Technology of China, 96
Jinzhai Rd, SM 611, Hefei, China, , Jun Zhang,
Kathy Stecke, Xianjun Geng
This paper studies a firm’s optimal ordering decision of a primary product when
the firm can bundle this product with another product. The firm makes an
ordering decision before demand uncertainty resolves, and then retails this
primary product either alone or in a mixed bundle with a secondary product. Our
results suggest that as compared to a no-bundling benchmark, the firm should
overstock (understock) when the wholesale price is high (low).
TA48