The transporter's impact on channel coordination and contractual agreements

Abstract

This dissertation focuses on the recent supply chain initiatives, such as Vendor Managed Inventory (VMI) and Third-Party Logistics (3PL), enabling the coordination of supply chain entities; e.g., suppliers, buyers, and transporters. With these initiatives, substantial savings are realizable by carefully coordinating inventory, transportation, and pricing decisions. The impact is particularly tangible when the transporter's role and the transportation costs are explicitly incorporated into decision mechanisms that aim to coordinate the supply channel. Furthermore, expanding the perspective of channel coordination by introducing the transporter as an individual party in the channel provides tangible benefits for each member of the channel. Recognizing the need for further analytical research in the field of multi-echelon inventory and channel coordination, we developed and solved a class of integrated inventory and transportation models with explicit shipment consolidation considerations. Moreover, we examined transporter-buyer and supplier-transporter-buyer channels and solved centralized and decentralized models for these channels with the aim of investigating the impact of transporters on channel performance. In this dissertation, we also developed efficient coordination mechanisms between the transporter and the other parties in the channel.