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BUYER POWER THROUGH PRODUCER'S DIFFERENTIATION AgEcon
Chambolle, Claire; Villas-Boas, Sofia Berto.
This paper shows that retailers may choose to offer products differentiated in quality to consumers, not to relax downstream competition, but to improve their buyer power in the negotiation with their supplier. We consider a simple vertical industry where two producers sell products differentiated in quality to two retailers who operate in separated markets. In the game, first retailers choose which product to carry, then each retailer and her chosen producer bargain over the terms of a two-part tariff contract and retailers finally choose the quantities. When upstream production costs are convex, the share of the total profits going to the retailer would be higher if they choose to differentiate. We thus isolate the wish to differentiate as "only" due to...
Tipo: Working or Discussion Paper Palavras-chave: Buyer Power; Product line; Differentiation; Marketing; L13; L42.
Ano: 2007 URL: http://purl.umn.edu/6866
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The Strategic Use of Private Quality Standards in Food Supply Chains AgEcon
von Schlippenbach, Vanessa; Teichmann, Isabel.
This paper highlights the strategic role retailers private quality standards play in food supply chains. Considering two symmetric downstream firms that are exclusively supplied by a finite number of upstream firms and letting the upstream firms decide which retailer to supply, we show that there exist two asymmetric equilibria in the downstream firms quality requirements. The asymmetry is driven by both an increase in the retailers buyer power and the retailers competition for suppliers. The use of private quality standards induces a decrease in social welfare, which can be softened by the implementation of a public minimum quality standard.
Tipo: Conference Paper or Presentation Palavras-chave: Private Quality Standards; Vertical Relations; Buyer Power; Food Supply Chain; Agribusiness; Agricultural and Food Policy; Agricultural Finance; Food Consumption/Nutrition/Food Safety; Industrial Organization.
Ano: 2011 URL: http://purl.umn.edu/114519
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