The Effect of Money-Back Guarantee and Customer Value on Dual-Channel Supply Chain

2019 ◽  
Vol 28 (5) ◽  
pp. 636-654 ◽  
Author(s):  
Limin Wang ◽  
Qiankun Song ◽  
Zhenjiang Zhao
2019 ◽  
Vol 11 (12) ◽  
pp. 3482 ◽  
Author(s):  
Rong Zhang ◽  
Jiatong Li ◽  
Zongsheng Huang ◽  
Bin Liu

This paper investigates in a dual-channel supply chain which return strategy is better for the manufacturer that considers the consumers’ utility. We find that a manufacturer prefers offering a Money-Back Guarantee (MBG) as long as the net salvage value of the returned product is positive in a channel. However, the return strategy of the retailer is more affected by the return policy of another channel than the net salvage value. In order to reduce online returns, we propose the online product customization channel, and then, we examine the choice of return policy and the manufacturer’s channel selection. We show that the demand and profit of the manufacturer will increase to a certain extent when opening an online customization channel. However, compared to the case where both channels provide an MBG, the implementation of online customization may hurt the manufacturer’s profits with the increase in consumer satisfaction in indirect channels.


Mathematics ◽  
2020 ◽  
Vol 9 (1) ◽  
pp. 11
Author(s):  
Shiming Yi ◽  
Liying Yu ◽  
Ziyuan Zhang

Considering customer value and value-added services provided by the online retail platform, this paper studies the differential pricing of a dual-channel supply chain consisting of one manufacturer and one online retail platform. Taking customer value into account in the dual-channel supply chain, this paper constructs separate and unified pricing of the direct sales channel and online retail platform’s distribution channel, and discusses each pricing model under a decentralized decision scenario and centralized decision scenario respectively. The results show that the total profit of a supply chain under the centralized decision scenario is better than the decentralized decision scenario in different ways, and the customer value of the two channels is also higher. Compared with the unified pricing of the two channels, the profit of the manufacturer is larger while the profit of the online retail platform is smaller under the separate pricing of the two channels. Moreover, the benefit of value-added services remains important to maximize the profit of the online retail platform and the customer value at the same time. Whether it is under separate pricing or unified pricing of the two channels, the antinomies effect always exists between the customer value and the profit per unit product. In order to further improve each party’s profit in the dual-channel supply chain under the decentralized decision scenario, it is necessary to improve the customer perception of profit as much as possible, and reduce the customer perception of loss as much as possible.


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