A Win–Win strategy analysis for an original equipment manufacturer and a contract manufacturer in a competitive market

URI College of Business professor Yuwen Chen along with colleagues Gulver Karamemis and Jiayuan Zhang author this paper published in the European Journal of Operational Research.

This paper investigates the outsourcing relationship between an original equipment manufacturer (OEM) and a contract manufacturer (CM) when both compete in the same product market. Highlights of the paper include:

Offer closed form solutions and Win–Win conditions for an outsourcing contract.
Identify outsourcing Win–Win–win conditions for all players.
Total supply chain profit under outsourcing exceeds that in-house production.
The supplier benefits from an original equipment manufacturer with a higher cost.