Investigating warehousing policies

The tendency of companies to expand their control through the entire supply chain is a significant managerial driver. On the other hand, large manufacturing and distribution firms have developed competences that do not cover all levels of the supply chain. In order to confront the lack of knowledge and expertise, enterprises can either outsource a specific operation or acquire a company that is specialized in the specific field. In this paper we focus on warehousing decisions and investigate three different warehousing policies and ownership structures of the warehousing facilities. The approach is based on game theory and an industrial example provides insight on the results reached.