{"title":"Should a multinational firm incentivize timely orders from retailing division through intersectoral data transfer?","authors":"Baozhuang Niu, Jiayun Liu, Yiyuan Ruan","doi":"10.1016/j.ejor.2025.08.045","DOIUrl":null,"url":null,"abstract":"In the cross-border e-commerce era, many multinational firms (MNFs) are operating local retailing divisions in emerging markets while also selling through e-tailers. Though e-tailers usually have a demand information advantage that can be known by the MNFs’ manufacturing divisions, interestingly, we note that due to a lack of cyber resilience, data transfer barriers between MNFs’ manufacturing and retailing divisions have widely inhibited intersectoral information transfer. Therefore, risk-averse retailing divisions may postpone orders to wait for the information, exposing them to a second-mover disadvantage. Intuitively, advanced intersectoral data transfer such as AI-enabled cybersecurity cloud platform is capable of facilitating the retailing division’s timely order based on demand information shared by the MNF, we observe that MNF’s tax-planning may be hampered under the Arm’s Length Principle, and tensions between horizontal (i.e., the e-tailer and the MNF’s retailing division) and vertical coordination may be exacerbated. Therefore, we study the MNF’s incentives to apply intersectoral data transfer based on a co-opetition game-theoretic model. We show that the retailing division’s preference varies with the tax disparity and its risk-averse degree. When tax disparity narrows, the <ce:italic>sourcing cost-saving effect</ce:italic> from postponed ordering allows the division to access demand information without incurring high costs. Establishing intersectoral data transfer is not always optimal for either the MNF or its retailing division. The MNF benefits when the tax disparity is high, whereas the retailing division should balance the information value against sourcing cost saving when deciding order timing.","PeriodicalId":55161,"journal":{"name":"European Journal of Operational Research","volume":"27 1","pages":""},"PeriodicalIF":6.0000,"publicationDate":"2025-08-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"European Journal of Operational Research","FirstCategoryId":"91","ListUrlMain":"https://doi.org/10.1016/j.ejor.2025.08.045","RegionNum":2,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"OPERATIONS RESEARCH & MANAGEMENT SCIENCE","Score":null,"Total":0}
引用次数: 0
Abstract
In the cross-border e-commerce era, many multinational firms (MNFs) are operating local retailing divisions in emerging markets while also selling through e-tailers. Though e-tailers usually have a demand information advantage that can be known by the MNFs’ manufacturing divisions, interestingly, we note that due to a lack of cyber resilience, data transfer barriers between MNFs’ manufacturing and retailing divisions have widely inhibited intersectoral information transfer. Therefore, risk-averse retailing divisions may postpone orders to wait for the information, exposing them to a second-mover disadvantage. Intuitively, advanced intersectoral data transfer such as AI-enabled cybersecurity cloud platform is capable of facilitating the retailing division’s timely order based on demand information shared by the MNF, we observe that MNF’s tax-planning may be hampered under the Arm’s Length Principle, and tensions between horizontal (i.e., the e-tailer and the MNF’s retailing division) and vertical coordination may be exacerbated. Therefore, we study the MNF’s incentives to apply intersectoral data transfer based on a co-opetition game-theoretic model. We show that the retailing division’s preference varies with the tax disparity and its risk-averse degree. When tax disparity narrows, the sourcing cost-saving effect from postponed ordering allows the division to access demand information without incurring high costs. Establishing intersectoral data transfer is not always optimal for either the MNF or its retailing division. The MNF benefits when the tax disparity is high, whereas the retailing division should balance the information value against sourcing cost saving when deciding order timing.
期刊介绍:
The European Journal of Operational Research (EJOR) publishes high quality, original papers that contribute to the methodology of operational research (OR) and to the practice of decision making.