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Improved Forward Buying Of Commodity Materials, Andrew Manikas, James Kroes
Improved Forward Buying Of Commodity Materials, Andrew Manikas, James Kroes
IT and Supply Chain Management Faculty Publications and Presentations
This research presents the Enhanced Commodity Forward Buy (ECFB) heuristic, a new method for commodity purchasing, which allows strategic forward buying of commodities for products that include commodity components or materials. The ECFB addresses limitations of existing methods by considering stochastic demand and stochastic commodity prices for products that contain both commodity and non-commodity materials. We conduct a simulation test of the new heuristic on 10 commodity indices using actual historical market prices, over a range of holding costs, markup margins, commodity percentages of the product’s cost of goods sold and demand distributions. The results of the simulation show that …
Negotiation, Email, And Internet Reverse Auctions: How Sourcing Mechanisms Deployed By Buyers Affect Suppliers’ Trust, Thomas F. Gattiker, Xiaowen Huang, Joshua L. Schwarz
Negotiation, Email, And Internet Reverse Auctions: How Sourcing Mechanisms Deployed By Buyers Affect Suppliers’ Trust, Thomas F. Gattiker, Xiaowen Huang, Joshua L. Schwarz
IT and Supply Chain Management Faculty Publications and Presentations
The Internet has made a wealth of new tools available to the industrial buyer. However, researchers have suggested that computer mediated interaction with suppliers may not be conducive to strong supplier relationships in general and to trust in particular. This paper compares two computer-mediated sourcing tools (email negotiation and Internet reverse auctions) with face-to-face negotiation. Information richness theory suggests that the different media will produce different impacts relating to sellers’ trust in buyers. Data are generated with a simulation experiment using 117 subjects. We found that information richness affects seller-buyer trust: Sellers who used face-to-face negotiation, the richest medium in …