Research on Stackelberg Models of "Many-to-One" Supply Chain in Private Electronic Markets

Compared to public and independent e-marketplaces, private electronic markets (PEM) have lots of virtues such as strengthening SC relationships with closer collaboration, etc. This paper studies a manufacturer Stackelberg model of a supply chain in PEM. It discusses what will be different about the Stackelberg leader& the follower& both of the manufacturers´ optimal order quantity, optimal revenues and the consumer surplus, etc. when setting up a PEM. By numerical experiments, the paper concludes that, both a low margin production cost and demand markets rich in elasticity are very helpful to the leader to set up PEM. However, both a low margin production cost and demand markets poor in elasticity will have a little influence on the follower in PEM.