Structural Supply Chain Collaboration Among Grocery Manufacturers

Both academicians and practitioners have extensively explored the important topic of supply chain collaboration. Most research, however, has focused on unilateral coordination via pricing signals or tactical opportunities such as Vendor Managed Inventory or Collaborative Planning, Forecasting and Replenishment (CPFR). Our research fills a gap in the current literature by quantifying the opportunity for strategic, multi-lateral collaboration through a shared distribution network. Specifically, we examine the opportunity for manufacturers to consolidate distribution networks to serve a set of common retailer customers. Through cost modeling of a factorial combination of scenarios, we show that: