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Assessing the impact of drop-shipping fulfilment operations on the upstream supply chain

Author

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  • Simone T. Peinkofer
  • Terry L. Esper
  • Ronn J. Smith
  • Brent D. Williams

Abstract

The use of drop-shipping strategies, the practice where end-consumer orders are fulfilled directly from upstream suppliers upon a retailer’s request, has grown in popularity. Due in large part to the growth of online retailing and the increased focus on integrated omni-channel fulfilment, retailers continue to express the strategic urgency of drop-shipping operations. In a broader sense, the concept of drop-shipping represents a new and emerging aspect of the supply chain triad phenomenon, where a buyer contracts with a supplier to deliver services directly to the buyer’s customer. In order to more fully understand the operational nuances and upstream impacts of triadic service supply chain relationships, we adopt a qualitative research methodology to investigate suppliers in the service triad, a perspective that has been, to-date, under-researched. By exploring these issues in the context of the drop-shipping service triad, we more specifically shed light on the processes and operational challenges that suppliers face when assuming the bridge position in drop-shipping service triads. Therefore, this research extends the current drop-shipping literature by shifting the research focus away from retailers to suppliers; and hence, shifting the focus from strategic use of drop-shipping towards a more tactical/operational perspective by exploring those who carry out drop-shipping operations.

Suggested Citation

  • Simone T. Peinkofer & Terry L. Esper & Ronn J. Smith & Brent D. Williams, 2019. "Assessing the impact of drop-shipping fulfilment operations on the upstream supply chain," International Journal of Production Research, Taylor & Francis Journals, vol. 57(11), pages 3598-3621, June.
    • Handle: RePEc:taf:tprsxx:v:57:y:2019:i:11:p:3598-3621
    DOI: 10.1080/00207543.2018.1543973
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    Cited by:

    1. Shi, Siyu & Sun, Jingchun & Cheng, T.C.E., 2020. "Wholesale or drop-shipping: Contract choices of the online retailer and the manufacturer in a dual-channel supply chain," International Journal of Production Economics, Elsevier, vol. 226(C).
    2. Barcs, Cristian & Pop, Izabela Luiza & Toader, Cezar & Ighian, Diana, 2022. "Drop-Shipping – A Business Model Without Holding Inventory: A Case Study of Online Store," MPRA Paper 118638, University Library of Munich, Germany.
    3. Kim, Nayeon & Montreuil, Benoit & Klibi, Walid, 2022. "Inventory availability commitment under uncertainty in a dropshipping supply chain," European Journal of Operational Research, Elsevier, vol. 302(3), pages 1155-1174.
    4. Guo Li & Hong Zheng & Mengqi Liu, 2020. "Reselling or drop shipping: Strategic analysis of E-commerce dual-channel structures," Electronic Commerce Research, Springer, vol. 20(3), pages 475-508, September.
    5. Sodero, Annibal C. & Namin, Aidin & Gauri, Dinesh K. & Bhaskaran, Sreekumar R., 2021. "The strategic drivers of drop-shipping and retail store sales for seasonal products," Journal of Retailing, Elsevier, vol. 97(4), pages 561-581.

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