The revenue sharing contracts found to be effective in developing an efficient supply chain, as most of the companies have already succeeded in it. One of the examples is the Video rental industry and its leaders and pioneers that manage movie studios.However, this concept did not yield the outcomes for some of the organizations.
But what are the reasons of their failures? What are the costs of implementation associated with revenue sharing contracts and when does it produce the desired results? The authors, including their own tenure, with a larger semi-conductor manufacturer, and by examining a few case illustrations, found some common tactics that take into accounts the basic sources of added value and added costto help in driving the solutions to these questions.
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