We present and study a three-stage model of a decentralized distribution system consisting of n retailers, each of whom faces a stochastic demand for an identical product. In the first stage, before the demand is realized, each retailer independently orders her initial inventory. In the second...

In different industries, such as automobiles, chemicals, or retailing, competitors are joining forces in establishing electronic marketplaces to reduce inefficiencies in the purchasing process and cut costs by combining their buying power. Joining such an alliance leads to reduced costs,...