Dual-channel supply chain pricing decisions with a risk-averse retailer

This paper investigates a dual-channel supply chain with one risk-neutral manufacturer and one risk-averse retailer where there is only one perishable product with price-dependent stochastic demand. We choose Conditional Value-at-Risk criterion to measure the retailer’s risk-averse level, and assume that the manufacturer’s direct sales channel and the retailer’s traditional channel adopt a consistent pricing strategy. The model explores a Nash bargaining problem where the manufacturer and the retailer negotiate with each other on the wholesale price, the retail price and the order quantity when they have equal bargaining power. It is found that when demand uncertainty follows a uniform distribution, a Nash bargaining equilibrium exists and the retail price will decrease as the retailer becomes more risk averse. However, when the risk-averse indicator increases, the manufacturer’s profit on his direct channel will decrease, increase or first increase and then decrease, depending on the values of the related parameters. The profit shares of the manufacturer and the retailer under the Nash equilibrium model are related to the risk-averse indicator of the retailer. Furthermore, we perform three sets of numerical experiments to verify the effects of the retailer’s risk-averse indicator on decision-making and profit allocations under the different environmental parameters and gain several meaningful managerial insights.     

Impact of demand price elasticity on advantages of cooperative advertising in a two-tier supply chain

This paper focuses on pricing and vertical cooperative advertising decisions in a two-tier supply chain. Using a Stackelberg game model where the manufacturer acts as the game leader and the retailer acts as the game follower, we obtain closed-form equilibrium solution and explicitly show how pricing and advertising decisions are made. When market demand decreases exponentially with respect to the retail price and increases with respect to national and local advertising expenditures in an additive way, the manufacturer benefits from providing percentage reimbursement for the retailer’s local advertising expenditure when demand price elasticity is large enough. Whether the manufacturer benefits from cooperative advertising is also closely related to supply chain member’s relative advertising efficiency. In the decision for adopting coop advertising strategy, it is critical for the manufacturer to identify how market demand depends on national and local advertisements. The findings from this research can enhance our understanding of cooperative advertising decisions in a two-tier supply chain with price-dependent demand.     

不确定条件下供应链期权契约风险分担模型

供应链期权契约是应对市场需求不确定性的一种重要途径,然而期权价格又给供应链带来了新的风险。针对供应链期权契约的风险分担问题,提出了根据谈判能力协商确定期权价格从而达到风险分担的方法。在市场不确定条件下,以单个制造商和单个零售商组成的供应链为研究对象,建立了基于谈判能力的供应链期权契约风险分担模型,分析了谈判能力对供应链订购量、生产安排以及期望收益的影响。研究发现,期权契约可以提高供应链各成员的期望收益,随着制造商谈判能力的增强,零售商的订单数量增加,期权数量减少,制造商的谈判能力降低了供应链的总期望收益。通过数值仿真分析,进一步验证了通过谈判分担期权契约风险的有效性,获得了对制定供应链期权价格具有指导意义的研究结论。      

考虑信息披露的双渠道供应链两周期定价策略

在一个含有线上直销渠道的双渠道供应链中,考察当消费者注重产品体验时,信息不披露和信息披露两种模式下制造商、零售商两周期的定价策略。研究发现:消费者对产品体验为高的概率和信息披露对提升制造商和零售商的议价能力都存在正向的作用;信息披露使实体店第二期的需求对前期需求更加敏感,而对第二期价格及成本的敏感性下降;不论信息是否披露,第一期实体店定价总高于网店定价,但当消费者体验产品为高的概率足够大时,网店在第二期可以采用高于实体店的定价策略,且信息披露可以使网店在第二期有更多的可能制定高于实体店的定价;信息披露使得制造商在两期内都可以获得更高的收益,而零售商的收益变化与披露成本有关,且零售商在第一期受益的可能性更高。     

Consumer search,transshipment, and bargaining power in a supply chain

We study a decentralised supply chain with one manufacturer and two symmetric retailers who could transship their excess inventory between each other. Without transshipment, the retailer’s unsatisfied customers search and buy the product at the other retailer with some probability. With transshipment, the retailer can transship the other retailer’s excess inventory to fulfil its own unmet demand. However, a transshipment price is often charged by one retailer for transshipping goods to another. We show the retailer’s profit is unimodal in the transshipment price, and the manufacturer’s profit increases in the customer search probability. Although the retailer’s preference over transshipment depends on the magnitude of search probability and transshipment price, the retailer may always prefer the transshipment no matter their magnitude. We then study the effect of bargaining power over the transshipment decision (whether to transship between retailers and at what transshipment price). Our analysis suggests that the manufacturer always prefers to control the transshipment price rather than to control whether to transship, while the retailer can prefer both. We also find that increasing bargaining power always benefits the manufacturer but could hurt the retailer. We finally check the robustness of our results by investigating the case with asymmetric retailers     

Optimal pricing strategy for the perishable food supply chain

This research investigates the optimal pricing strategy for the perishable food supply chain. Using the setting of a two-echelon supply chain including a supplier and a retailer, we apply the game theory approach to derive the equilibriums for both a single pricing strategy and a two-stage pricing strategy. Through a comparison of the equilibriums, we explore how the two pricing strategies affect the supply chain’s decisions and supplier’s and retailer’s performance individually and collectively. The results of the analysis show that the optimal choice of pricing strategy depends on the price markdown cost and its relationship with the two critical thresholds that are determined by a combination of factors including the potential market size, the price and quality sensitivity factors, the initial quality, the unit product cost, and the quality deterioration rate.     

Coordination of a dual-channel supply chain after demand or production cost disruptions

Coordinating a dual-channel supply chain could not only achieve the integrated profit of the supply chain but also alleviate the channel conflict. Although some researches addressed this area, there is scant literature to discuss the coordination issue in the situations of disruption. To fill this void, we utilise a contract with a wholesale price, a direct channel’s price and a lump sum fee to coordinate a dual-channel supply chain under the cases of demand disruptions and production cost disruptions. After deriving the optimal contract for each case, we find that the manufacturer can achieve coordination of the disrupted supply chain by adjusting the parameters of the coordination contract used in a normal environment. We also show that after disruptions, there exists a contract adjustment benefit zone, in which both the manufacturer and the retailer can benefit from the adjustment of coordination contract when demand increases or production cost decreases. A further analysis of the production and distribution strategies in the coordinated dual-channel supply chain after disruptions suggests that the adjustment of the total production and sales of each channel depends heavily on the level of disruptions and the degree of consumers’ loyalty to both channels.     

Pricing decisions in closed-loop supply chains with marketing effort and fairness concerns

We investigate closed-loop supply chains (CLSCs) under four reverse channel structures where a central planner, a manufacturer (M), a retailer (R) or a third party (T), respectively, serves as the collector of used product and demand depends on R’s marketing effort. We derive supply chain profitability under both the centralised and decentralised CLSCs and furnish the optimal marketing effort, collection rate and pricing decisions for the supply chain members. We then extend the base models along two directions: the first extension incorporates R’s distributional fairness concerns into the M collection model and the second extension considers potential recycle cost advantages by R and T compared to the M collection model.     

考虑激励模式的动态回收闭环供应链最优决策与协调研究

考虑由单一的制造商和零售商组成的闭环供应链,制造商不仅通过正向供应链销售新产品,还通过激励措施从消费者那里回收旧产品,且将动态回收过程、HJB阶段控制纳入到供应链中。除探讨不同情形下均衡决策外,还设计激励成本分担契约来促进废旧产品的回收。研究表明:集中决策较分散决策供应链系统利润更高,产品回收率更高,回收激励强度更高;产品的销售价格、批发价格、零售商收益、制造商收益与回收率呈正相关,回收激励强度与回收率呈负相关;激励成本分担契约下,制造商的回收强度、回收率达到集中决策的水平,有趣的是激励成本分担契约下,产品的批发价格、销售价格均略高于分散决策的水平,制造商的收益实现帕累托改进,零售商的收益只有在一定情形下才会实现帕累托改进,供应链系统的整体收益实现帕累托改进。此外,还探讨了激励成本分担情形下零售商不出现破产的条件。最后给出算例分析验证了相关结论。     

Pricing decisions for three-echelon supply chain with advertising and quality effort-dependent fuzzy demand

Simultaneous influence of market power structure, advertising and quality efforts on the optimal pricing decisions and performance of a multi-echelon supply chain under uncertainty have received scant attention in the literature. We focus on this gap by examining a serial decentralised three-echelon supply chain consisting of a supplier, a manufacturer and a retailer. The uncertainty associated with customer demand, marginal production costs and effort costs is expressed as linguistic or fuzzy variables. We analyse centralised supply chain to obtain all benchmark parameters. We investigate four decentralised supply chain cases through fuzzy game theoretic approach. We compare among three Stackelberg games with various supply chain leaderships and a vertical Nash. Our key findings are as follows. First, the manufacturer puts least quality effort while retailer puts least advertising effort when they act as Stackelberg leader in a three-echelon supply chain. Second, supplier's per unit price is governed by the channel leadership in three-echelon supply chain while retail prices are less affected by the leadership. We investigate the impact of fuzzy degree of quality and advertising sensitivity on optimal profit distribution among agents. We present numerical analysis to illustrate the importance of the derived theoretical results and discuss additional managerial insights.     

Pricing and remanufacturing decisions in two competing supply chains

This paper considers the pricing and remanufacturing decisions in a duopoly market with two competing supply chains, which compete at both manufacturer and retailer levels. There are one manufacturer and one retailer in each supply chain, one manufacturer produces the new product directly from raw material, while the other manufacturer has incorporated a remanufacturing process for used product into the original production system. Based on different industry organisation structures and the chain members’ competing forms, five game decision models are established to explore the chain members’ optimal strategies on price and/or remanufacturing, and the corresponding equilibrium solutions are obtained. Finally, we carry out the sensitivity analysis through numerical studies of some key parameters for examining their influences on the pricing decisions and chain members’ maximum profits. On the basis of comparison and analysis, some managerial insights are derived.     

Supplier credit guarantee loan in supply chain with financial constraint and bargaining

This paper adopts a multiunit bilateral bargaining framework on financial decision. In a two-echelon supply chain, the supplier sells products through a financial constraint retailer. If needed, the retailer gets a short-term financing from a bank by supplier credit guarantee loan (CGL). Through applying the Nash bargaining framework, we formulate two-level game models, i.e. Retailer-Supply System negotiation and Supplier-Bank negotiation. In this paper, we study and discuss the equilibrium order quantity which is affected by initial working capital and interest rate, the retailer-supply system negotiation and upstream wholesale price effects for supply chain performance, the supplier-bank negotiation and interest rate decisions with different capital markets. The results show: (i) there exists loan size limit for financial constraint retailer under CGL. (ii) The upstream wholesale price increase will weaken retailer’s bargaining position, and the supply system may gain or lose depending on the bargaining power. (iii) There exists unique equilibrium sharing ratio in supply system, which means CGL can achieve risk sharing. (iv) Within a supply system, the upstream wholesale price advantage will weaken bank’s profit, whereas supplier may gain or lose depending on his bargaining power.     

Myopic vs. far-sighted behaviours in a revenue-sharing supply chain with reference quality effects

In this paper, we consider a dynamic supply chain where a manufacturer produces and distributes a featured product through an exclusive retailer to end consumers. The manufacturer decides the product quality and wholesale price, while the retailer sets the retail price in the presence of a revenue-sharing contract and consumers’ reference quality effects. The objective of this study is to investigate the impacts of myopic behaviour regarding the reference quality on the product quality and pricing strategies and profits of both members. Our results suggest that the manufacturer’s myopia leads to a higher quality, higher price strategy and a higher quality–price ratio which benefits consumers. Meanwhile, relative to the far-sighted behaviour, myopia results in a more quality-sensitive but less price-sensitive market demand. What’s more, we find that the manufacturer is apt to act in a far-sighted way, but the retailer isn’t always willing to cooperate with a far-sighted manufacturer. Taking myopic strategies for both members is likely to gain a high profit of the whole supply chain for a relatively high marginal contribution of product quality on demand and a relatively low revenue-sharing proportion.     

Optimisation of online retailer pricing and carrier capacity expansion during low-price promotions with coordination of a decentralised supply chain

In recent years, many online retailers in China set low prices on 11 November, which stimulates huge delivery demand and results in many problems although carriers make an effort to increase their delivery capacities temporarily. To circumvent this difficulty, we consider a supply chain consisting of an online retailer, who can set price to influence the demand, and a capacitated carrier, whose capacity can be expanded at a high cost. We derive the optimal decisions in the centralised and decentralised decision systems, and compare the performances of the two systems. We find that the optimal decisions, and which system has lower price, larger capacity increment, and more late delivered goods depends on the model parameters (the market scale, the late delivery costs, the capacity expansion cost, the delivery fee, and the demand uncertainty). Specially, we show that, contrary to the traditional channel, the online retailer in the decentralised system may set lower price and the carrier has less incentive to expand capacity in the decentralised system in some situations, which underlines the need for coordination. In addition, we propose coordination contracts to improve the overall performance of the supply chain under deterministic and random demands.     

Green supply chain contracts with eco-labels issued by the sales platform: profitability and environmental implications

Considering environmentally conscious consumers, a manufacturer, and a sales platform which provides eco-labels for qualified manufacturers, this paper develops a supply chain model to study how eco-labels affect green supply chain operations, from the profitability and environmental perspectives. The results show that the sales platform prefers the agency contract, but the manufacturer prefers the wholesale price contract. Considering the performance of the supply chain, the agency contract brings a higher profit while the wholesale price contract results in a bigger environmental improvement. An unexpected but interesting result is that when the agency contract is used and consumer green awareness increases, the sale price declines rather than increasing as it does under the wholesale price contract. This decline happens because the required marketing effort of the sales platform will be lower, which incentivises the platform to reduce the commission rate. Consequently, the manufacturer faces a lower commission rate and a higher margin when consumers display greater green awareness. Moreover, as the core and more powerful player of the supply chain, the sales platform can propose a platform-led revenue sharing contract to fully coordinate the supply chain, which improves the performance of the supply chain both in profitability and environmental perspectives.     

价格相依的闭环供应链渠道选择和协调策略

从社会环保意识、回收价格以及产品销量的角度构建了EOL(End-of-life)产品的供给函数,对分散决策时零售商销售渠道下的不同回收模式之闭环供应链进行了博弈分析,得到了闭环供应链成员的最优定价策略和最终利润,以及制造商渠道选择与回收成本的临界关系.设计了一个收入费用分享合同用以协调分散决策下的闭环供应链.     

Influence of logistic service level on multichannel decision of a two-echelon supply chain

This paper investigates the channel structure and pricing problem of a two-echelon supply chain consisting of a manufacturer and a retailer. There are four common channel structures: (1) traditional retail channel, (2) the retailer’s traditional and online channel, (3) traditional retail channel and the manufacturer’s online channel, (4) traditional retail channel and online channel of a manufacturer and a retailer. Four Models (Model R, Model RD, Model MR, and Model MRD) are established and analysed based on four channel structures. Considering the influence of logistic services on consumers’ channel choice, this paper uses Stackelberg game and consumer utility function to analyse the profit of the manufacturer, the retailer and the whole supply chain, and obtains the optimal channel strategy of the manufacturer and the retailer in the four models. In addition, our study also finds that First, the manufacturer’s online channel opening can indirectly stimulate consumers to buy products in the traditional retail channel, which increases the demand for traditional retail channel. Second, the manufacturer’s online channel is more conducive to improving the profit of the whole supply chain than the retailer’s online channel under the dual channel structure. Third, multiple channels consisting of traditional retail channel and online channel of the manufacturer and the retailer can provide consumers with the lowest retail price, which is most beneficial to the retailer.     

考虑收取搭便车消费者产品体验费的双渠道供应链定价

为研究实体零售商收取搭便车消费者产品体验费时消费者搭便车行为对厂商的影响,并探讨实体零售商收取产品体验费的条件,文章考虑一个制造商和一个实体零售商组成的双渠道供应链,基于消费者效用理论,利用K-T条件,分别在收取产品体验费和不收取产品体验费两种情形下,分析对比了消费者搭便车行为对厂商决策的影响。研究表明,收取的搭便车消费者产品体验费与实体零售商的产品销售价格正相关,当消费者旅行成本较低时,网络渠道产品销售价格与收取的产品体验费负相关。当消费者旅行成本较低且销售的产品估值较高时,实体零售商收取产品体验费才能使自身受益。研究进一步显示,实体零售商收取搭便车消费者产品体验费会损害制造商的利润,加剧了制造商和零售商之间的竞争。     

The impact of retailers’ alliance on manufacturer’s profit in a dual-channel structure

When a manufacturer adds a direct sales channel to its existing retail channel, retailers may cooperate with one another to respond to this new competition. Our study develops a Cournot competition model in a dual-channel supply chain consisting of a manufacturer and multiple retailers. In a Stackelberg decision model, the manufacturer first sets the direct sales quantity and wholesale price, and then the retailers decide the order quantities. The results indicate that forming an alliance is not always beneficial for retailers. When direct sales cost is high, there is less likelihood for retailers to collaborate. On the other hand, retailers will form an alliance when direct sales cost is sufficiently low. This will likely reduce the manufacturer’s profit. As such decreasing direct sales cost is not necessarily beneficial for the manufacturer because of the retailers’ possible collaborative efforts. In addition, the study finds that when demand fluctuation increases or the manufacturer’s information accuracy decreases, it is more likely that retailers will form an alliance. After relaxing the assumption of homogeneous retailers, our numerical study validates the possibility of partial alliance. If some retailers’ marginal costs are sufficiently high, we could see the formation of a partial alliance.     

基于批发价定价权转移的制造商渠道选择

制造商的批发价定价权发生转移会带来供应链绩效增加和制造商利润降低。利用这一供应链特征,给出了制造商渠道选择的数理方法。制造商在零售商具有/不具有批发价定价权的渠道选择中,潜在的市场规模是关键的选择因素。研究表明:市场规模相同时,制造商会选择拥有批发价定价权的渠道;当拥有批发价定价权的零售商拥有较大市场规模时,制造商会选择该供应链渠道,而此时对供应链双方都具有价值。