Transfer of newsvendor inventory and supply risks to sub-industry and the public by financial instruments

Autor:	Yick-Hin Hung, T.C.E. Cheng, Leon Y. O. Li
Rok vydání:	2013
Předmět:	Economics and Econometrics Financial risk Supply chain Management Science and Operations Research Newsvendor model General Business Management and Accounting Industrial and Manufacturing Engineering Profit (economics) Microeconomics Economics Risk pool Speculation Hedge (finance) Futures contract
Zdroj:	International Journal of Production Economics. 143:567-573
ISSN:	0925-5273
DOI:	10.1016/j.ijpe.2011.10.019
Popis:	We consider a two-stage newsvendor model of a sub-industry in which suppliers have short lead-time capacity to produce goods for retailers that are selling non-identical products. We argue that the inventory and supply risks of the newsvendors due to demand uncertainty can be pooled and shared among different supply chains by treating reserved capacity as commodities and trading them as futures and options on futures to hedge the risks. The risks will be further shared with and transferred to the public if speculators are allowed to play the game. We show that this new mechanism of combining operational and financial risk hedging strategies offers industries a new way to more efficiently meet demand and improve profit.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::2271e658b7ec5748d9bdd2eba2f930b7 https://doi.org/10.1016/j.ijpe.2011.10.019 Zobrazit plný text záznamu Full Text from ScienceDirect