Optimal Decisions in a Sea-Cargo Supply Chain with Two Competing Freight Forwarders Considering Altruistic Preference and Brand Investment

Abstract

Maritime transportation is a crucial component of international cargo transport, offering several advantages, such as route flexibility, large capacity, and cost-effectiveness. The competition and collaboration among the node enterprises in the sea-cargo supply chain system (SCSCS) directly impact the overall structure and efficiency of the supply chain system, introducing complexity in analysis. This research focuses on a two-level SCSCS comprising one shipping company and two competing freight forwarders, considering their altruistic preferences manifested through contributing to the shipping company’s brand building. Employing a Stackelberg game model, this study examines the effects of the shipping company’s brand investment willingness and the freight forwarders’ altruistic preferences on the decision making and profits of all stakeholders. The findings reveal that a higher willingness of the shipping company to invest in its brand building leads to increased profits for all parties involved. However, while the altruistic behaviors of the freight forwarders can enhance the shipping company’s profits, their own profits may not necessarily see the same impact. Furthermore, moderate competition between the freight forwarders can enhance the profits for all members. This research identifies the circumstances in which the freight forwarders’ altruistic preferences can lead to increased profits for themselves, achieving both altruistic and self-interested outcomes.

Keywords

• sea-cargo supply chain
• altruistic preference
• brand investment
• optimal decision
• competition for freight forwarders