An agent-based model of supply chain collaboration: Investigating manufacturer loyalty

Collaboration is considered to be a key driver to supply chain success. However, the ideal collaboration practice is difficult to achieve. Firms’ strategy and behaviour in supply chain collaborations are identified as the main reasons for supply chain failure. To study this problem, we use an agent-based model which represents two-stage supply chains, consisting of customers, manufacturers, and suppliers. The firms exist in a two-dimension supply chain strategic space defined by efficiency and responsiveness. In this paper, we examine the effect of manufacturer loyalty on supply chains’ performance in an innovative products market from system perspective. Measuring the supply chains fill rate and number of surviving supply chains in the market, the results indicate that manufacturer loyalty at intermediate levels does not seem to guarantee supply chain success in a market of innovative products, unless it is very high or does not exist at all.