Horizontal collaboration in oligopoly supply chain Online publication date: Mon, 12-Jul-2021
by Sonu Rajak; P. Parthiban; R. Dhanalakshmi
International Journal of Services and Operations Management (IJSOM), Vol. 39, No. 3, 2021
Abstract: Oligopolistic markets are those in which a few numbers of firms produce and markets similar products to similar markets and customers, and this group of few hold a significant market share. Since these oligopolistic firms already have effective penetration in distribution lanes, there are areas where these firms can cooperate while competing with others. This paper aims to check the feasibility of horizontal collaboration on transportation for these oligopolistic firms by conducting a study on a three-firm four-zone case model. The study uses a mixed integer linear programming model to harness the potential of load bundling and backhauling optimisation when the transportation load demands of these firms are merged. The competitive and cooperative scenarios are compared using different performance measures like cost savings, reduction of no. of trips, and asset utilisation. Also, the effort is taken to ensure the model is framed on the real case scenarios present in the Indian transportation industry.
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