Strategic evolution in manufacturer–supplier collaboration: A game‐theoretic exploration of product customization dynamics

Amid rising demand for personalized products, manufacturers are forming collaborative bonds with suppliers, driven by revenue and cost‐sharing arrangements. This study presents an evolutionary game model examining collaboration nuances and analyzes the impact of customization, revenue, and cost‐shar...

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Bibliographic Details
Published in:Managerial and decision economics 2024-12, Vol.45 (8), p.5491-5502
Main Authors: Wu, Qiao, Zhang, Shuning, Zhang, Hongye, Zhang, Justin Zuopeng
Format: Article
Language:English
Subjects:
Bidirectionality
Competition
Competitiveness
Cost sharing
Customization
Efficacy
Game theory
Games
Manufacturers
Revenue
Suppliers
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Summary:Amid rising demand for personalized products, manufacturers are forming collaborative bonds with suppliers, driven by revenue and cost‐sharing arrangements. This study presents an evolutionary game model examining collaboration nuances and analyzes the impact of customization, revenue, and cost‐sharing ratios. Findings reveal customization's bidirectional effect on collaboration and a distinctive relationship between revenue‐sharing and collaboration probability. Increased cost‐sharing ratios deter manufacturers from collaboration, favoring revenue‐sharing mechanisms to incentivize supplier participation. The study highlights revenue‐sharing's efficacy in promoting collaboration between manufacturers and suppliers to enhance product competitiveness.
ISSN:0143-6570
1099-1468
DOI:10.1002/mde.4344