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Should suppliers allow capacity transfers?

Author

Listed:
  • Neda Khanjari
  • Izak Duenyas
  • Seyed M.R. Iravani

Abstract

This research considers situations in which buyers pay to reserve their suppliers' capacity for future use. The study specifically explores whether suppliers should provide transfer rights, allowing buyers unable to use all of their reserved capacity to transfer the excess to another buyer, and whether they should charge a transfer fee. The study finds that, in most cases, the supplier maximizes financial outcomes when the buyer releasing the excess capacity keeps most of the retail‐level profit from the transfer and the supplier does not charge a transfer fee.

Suggested Citation

  • Neda Khanjari & Izak Duenyas & Seyed M.R. Iravani, 2022. "Should suppliers allow capacity transfers?," Production and Operations Management, Production and Operations Management Society, vol. 31(5), pages 2324-2340, May.
    • Handle: RePEc:bla:popmgt:v:31:y:2022:i:5:p:2324-2340
    DOI: 10.1111/poms.13687
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    References listed on IDEAS

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