Analyzing risks faced by e-tailers in cross-border e-commerce
Kanglin CHEN | 12/08/2021

Recent years have seen considerable market growth in cross-border e-commerce, attracting numerous e-tailers to engage in cross-border business. Despite the rapidly growing market, e-tailers face the challenge of managing the disruption risks caused by various factors, such as public health concerns (COVID-19 pandemic), extreme weather events (typhoons), and international trade regulations (tariffs).

Assistant Professor Kanglin Chen from the Department of Information Systems and Management Engineering at the Southern University of Science and Technology (SUSTech) and his co-authors have recently studied the role of dual sales channel operations in managing disruption risks faced by e-tailers in cross-border e-commerce. They were motivated by the prevalence among e-tailers that establish dual sales channels (a bonded-warehouse channel and a direct-shipping channel) for cross-border e-tailing.

Their research, entitled “Strategic Waiting for Disruption Forecasts in Cross-Border E-Commerce Operations,” has been published in Production and Operations Management, a top academic journal in the operations management discipline. It is also one of the 24 leading business journals ranked by the University of Texas at Dallas (UT Dallas) and one of the Financial Times 50 Journals in business management and economics.

The bonded-warehouse channel is operated with an “import-to-stock” mode: A bonded warehouse is a storage space near the market for e-tailers to pre-stock imported goods for demand fulfillment. The direct-shipping channel is operated with an “import-to-order” mode: e-tailers purchase goods from overseas suppliers and goods are delivered directly from the overseas supplier to customers by international logistics. The direct-shipping channel will be disrupted if international logistics are out of operation.

By examining e-tailers’ horizontal interaction between sales channels and vertical interaction with overseas suppliers, this paper identifies the effects of channel coordination and cost reduction dependent on the relative importance of the two sales channels. These effects are revealed and play an important role in shaping e-tailers’ strategies to manage disruption risks in cross-border e-commerce.

Assistant Professor Kanglin Chen is the co-first author of this paper. This study was a collaborative effort, involving Professor Baozhuang Niu from South China University of Technology (SCUT), Associate Professor Lei Chen from Jinan University, Assistant Professor Chao Ding from The University of Hong Kong (HKU), and Professor Xiaohang Yue from the University of Wisconsin-Milwaukee (UWM).

This work was supported in part by the National Natural Science Foundation of China (NSFC) and the Guangdong Basic and Applied Basic Research Foundation.

Kanglin Chen’s primary expertise focuses on global supply chain management and sustainable operations under regulations. 

Paper link: https://doi.org/10.1111/poms.13371

 

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