IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v46y2025i3p1571-1583.html

Outsourcing Strategy Selection of Original Brand Manufacturers in the Fashion Industry Under the Influence of Brand Spillover

Author

Listed:
  • Bing Jiang
  • Zhou Fang

Abstract

Outsourcing strategy plays an essential role in manufacturing production. Compared to traditional manufacturing industries, brand spillover behavior from contract manufacturers is more prominent in the fashion industry's outsourcing practices. Therefore, we have developed a model for original brand manufacturers (OBM) to choose an outsourcing strategy under the influence of various factors: OBM can outsource production to a competing manufacturer (CM), a non‐competing manufacturer (NCM), or produce internally. If CM is the only contractor for OBM, it will enhance its brand power through brand spillover. If NCM is the only contractor for OBM, there are quality control issues. In summary, we consider three outsourcing strategies for the OBM: outsourcing production to CM, outsourcing to NCM, or establishing internal production, which correspond to strategies C, N, and F, respectively. We find that the brand spillover has a greater impact on OBM than expected. It affects OBM's production planning by influencing market demand, resulting in the profit of strategy C always being lower than strategy N. This forces OBM to face quality control issues. On this basis, we discuss blockchain technology that enables OBM to address quality control issues while dealing with brand spillovers. Interestingly, blockchain technology does not always bring benefits and can only solve problems under specific conditions. In addition, we also prove that the dual‐source strategy, that is, OBM outsources production to CM and NCM simultaneously, is better than the C and N strategies, but whether it is better than the F strategies depends on the investment cost.

Suggested Citation

  • Bing Jiang & Zhou Fang, 2025. "Outsourcing Strategy Selection of Original Brand Manufacturers in the Fashion Industry Under the Influence of Brand Spillover," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 46(3), pages 1571-1583, April.
    • Handle: RePEc:wly:mgtdec:v:46:y:2025:i:3:p:1571-1583
    DOI: 10.1002/mde.4454
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/mde.4454
    Download Restriction: no
    File URL: https://libkey.io/10.1002/mde.4454?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Huang, He & Xu, Hongyan, 2015. "Dual sourcing and backup production: Coexistence versus exclusivity," Omega, Elsevier, vol. 57(PA), pages 22-33.
    2. Mills, David E, 1995. "Why Retailers Sell Private Labels," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 4(3), pages 509-528, Fall.
    3. Jan Klostermann & Tobias K. Hinze & Franziska Völckner & Ann-Kristin Kupfer & Rouven Schwerdtfeger, 2024. "Avengers, assemble! A network-based contingency analysis of spillover effects in multi-brand alliances," Journal of the Academy of Marketing Science, Springer, vol. 52(2), pages 449-469, March.
    4. Sara Saberi & Mahtab Kouhizadeh & Joseph Sarkis & Lejia Shen, 2019. "Blockchain technology and its relationships to sustainable supply chain management," International Journal of Production Research, Taylor & Francis Journals, vol. 57(7), pages 2117-2135, April.
    5. Yimin Wang & Wendell Gilland & Brian Tomlin, 2010. "Mitigating Supply Risk: Dual Sourcing or Process Improvement?," Manufacturing & Service Operations Management, INFORMS, vol. 12(3), pages 489-510, September.
    6. Brian Tomlin, 2006. "On the Value of Mitigation and Contingency Strategies for Managing Supply Chain Disruption Risks," Management Science, INFORMS, vol. 52(5), pages 639-657, May.
    7. Bin Shen & Qingying Li & Ciwei Dong & Vincent Quan, 2016. "Design outsourcing in the fashion supply chain: OEM versus ODM," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 67(2), pages 259-268, February.
    8. Zhang, Zhiming & Ren, Da & Lan, Yanfei & Yang, Shanxue, 2022. "Price competition and blockchain adoption in retailing markets," European Journal of Operational Research, Elsevier, vol. 300(2), pages 647-660.
    9. Chen, Jingxian & Liang, Liang & Yao, Dong-qing, 2019. "Factory encroachment and channel selection in an outsourced supply chain," International Journal of Production Economics, Elsevier, vol. 215(C), pages 73-83.
    10. Zhang, Kun & Choi, Tsan-Ming & Chung, Sai-Ho & Dai, Yue & Wen, Xin, 2024. "Blockchain adoption in retail operations: Stablecoins and traceability," European Journal of Operational Research, Elsevier, vol. 315(1), pages 147-160.
    11. Li, Qiu-xiang & Ji, Hui-min & Huang, Yi-min, 2022. "The information leakage strategies of the supply chain under the block chain technology introduction," Omega, Elsevier, vol. 110(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Akbarzadeh Sarabi, Mohammad & Taleizadeh, Ata Allah & Bhattacharya, Arijit, 2026. "Towards blockchain-enabled circular closed-loop supply chain and impact of consumers’ distrust in price, product greenness sensitivity and carbon tax and subsidy," European Journal of Operational Research, Elsevier, vol. 328(1), pages 105-121.
    2. Guo, Penghui & Feng, Gengzhong & Wang, Kai & Zhou, Xiaoyang & Liu, Qi, 2025. "Analysis of blockchain technology implementing and financing provision strategies in contract farming supply chains," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 203(C).
    3. Papachristos, Ioannis & Pandelis, Dimitrios G., 2022. "Newsvendor models with random supply capacity and backup sourcing," European Journal of Operational Research, Elsevier, vol. 303(3), pages 1231-1243.
    4. Xiang Li, 2017. "Optimal procurement strategies from suppliers with random yield and all-or-nothing risks," Annals of Operations Research, Springer, vol. 257(1), pages 167-181, October.
    5. Li, Yongjian & Zhen, Xueping & Qi, Xiangtong & Cai, Gangshu (George), 2016. "Penalty and financial assistance in a supply chain with supply disruption," Omega, Elsevier, vol. 61(C), pages 167-181.
    6. Mili Mehrotra & William Schmidt, 2021. "The Value of Supply Chain Disruption Duration Information," Production and Operations Management, Production and Operations Management Society, vol. 30(9), pages 3015-3035, September.
    7. Bo He & He Huang & Kaifu Yuan, 2016. "Managing supply disruption through procurement strategy and price competition," International Journal of Production Research, Taylor & Francis Journals, vol. 54(7), pages 1980-1999, April.
    8. Qi Feng & Justin Jia & J. George Shanthikumar, 2019. "Dynamic Multisourcing with Dependent Supplies," Management Science, INFORMS, vol. 67(6), pages 2770-2786, June.
    9. Sheu, Jiuh-Biing, 2016. "Supplier hoarding, government intervention, and timing for post-disaster crop supply chain recovery," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 90(C), pages 134-160.
    10. Qi, Lian & Shi, Jim (Junmin) & Xu, Xiaowei, 2015. "Supplier competition and its impact on firm׳s sourcing strategy," Omega, Elsevier, vol. 55(C), pages 91-110.
    11. Long He & Ying Rong & Zuo‐Jun Max Shen, 2020. "Product Sourcing and Distribution Strategies under Supply Disruption and Recall Risks," Production and Operations Management, Production and Operations Management Society, vol. 29(1), pages 9-23, January.
    12. Jain, Tarun & Hazra, Jishnu, 2017. "Dual sourcing under suppliers' capacity investments," International Journal of Production Economics, Elsevier, vol. 183(PA), pages 103-115.
    13. Cheong, Taesu & Song, Sang Hwa, 2013. "The value of information on supply risk under random yields," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 60(C), pages 27-38.
    14. Xiao Huang & Tamer Boyacı & Mehmet Gümüş & Saibal Ray & Dan Zhang, 2016. "United We Stand or Divided We Stand? Strategic Supplier Alliances Under Order Default Risk," Management Science, INFORMS, vol. 62(5), pages 1297-1315, May.
    15. Zhang, Xuefeng & Zhang, Yutan & Li, Guo, 2024. "Strategic inventory in semi-conductor supply chains under industrial disruption," International Journal of Production Economics, Elsevier, vol. 272(C).
    16. Li, Lixu & Hou, Yan & Chen, Lujie & Liu, Yaoqi & Trindade, Maria A.M., 2025. "Unlocking sustainable performance with blockchain technology: Insights from organizational learning theory," International Journal of Production Economics, Elsevier, vol. 283(C).
    17. Onur Boyabatlı, 2015. "Supply Management in Multiproduct Firms with Fixed Proportions Technology," Management Science, INFORMS, vol. 61(12), pages 3013-3031, December.
    18. Ivanov, Dmitry & Pavlov, Alexander & Sokolov, Boris, 2014. "Optimal distribution (re)planning in a centralized multi-stage supply network under conditions of the ripple effect and structure dynamics," European Journal of Operational Research, Elsevier, vol. 237(2), pages 758-770.
    19. Chen, Li-Ming & Chang, Wei-Lun, 2020. "Under what conditions can an application service firm with in-house computing benefit from cloudbursting?," European Journal of Operational Research, Elsevier, vol. 282(1), pages 71-80.
    20. Jie Xiang & Juliang Zhang & T. C. E. Cheng & Jose Maria Sallan & Guowei Hua, 2019. "Efficient Multi-Attribute Auctions Considering Supply Disruption," Asia-Pacific Journal of Operational Research (APJOR), World Scientific Publishing Co. Pte. Ltd., vol. 36(03), pages 1-28, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:46:y:2025:i:3:p:1571-1583. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.