Quality assurance?client or supplier?

Supplier development or supplier switching?

We study a firm’s cost-based sourcing decision of whether to invest in an incumbent supplier or switch to an alternative supplier in order to realise lower purchasing costs. In isolation, it can be shown that the development of an incumbent supplier (i.e., a cooperative investment) becomes more attractive, the higher the uncertainty about the price the buying firm can realise on the market and ...

Customer Loyalty and Supplier Strategies for Quality Competition II: Supplier Quality Strategies

We wish to understand how companies should set the service-levels provided by their operations. To this end, we use the measures of customer loyalty obtained in [5] to develop simple, normative models for suppliers seeking to maximize long-run average profits. The results provide insight to suppliers on the level of service they should offer.

Efficient Supplier or Responsive Supplier? An Analysis of Sourcing Strategies under Competition

Motivated by the recent trend of onshoring/backshoring, this paper studies a two-stage sourcing game where competing firms may choose between sourcing internationally (call this efficient sourcing strategy due to low production cost) and sourcing domestically (call this responsive sourcing strategy due to short lead time). We first characterize the equilibrium of the sourcing game. Then we exam...

Quality-based supplier selection and evaluation using fuzzy data

Since fuzzy quality data are ubiquitous in the real world, under this fuzzy environment, the supplier selection and evaluation on the basis of the quality criterion is proposed in this paper. The Cpk index has been the most popular one used to evaluate the quality of supplier’s products. Using fuzzy data collected from q P 2 possible suppliers’ products, fuzzy estimates of q suppliers’ capabili...

Application Example: Quality control at automotive supplier GEDIA