scholarly journals Money-Back Guarantee, Dual Money-Back Guarantee, and O2O Strategy in a Manufacturer’s Dual-Channel Supply Chain

2020 ◽  
Vol 2020 ◽  
pp. 1-21 ◽  
Author(s):  
Jiqiong Liu ◽  
Minglun Ren ◽  
Aifeng Yang ◽  
Shuai Feng
Keyword(s):  
Return Loss ◽  
Pricing Strategies ◽  
Direct Channel ◽  
Critical Factors ◽  
Internet Service ◽  
Dual Channel ◽  
Retail Channel ◽  
Dual Channel Supply Chain ◽  
The Impact ◽  
Money Back Guarantee

Return services are increasingly valued by manufacturers, retailers, and customers. In many countries, an offer of money-back guarantee (MBG) is legally binding. In this paper, we discuss how a retailer and manufacturer with a direct channel should choose single or dual MBG and pricing strategies. We identify the conditions under which a retailer or manufacturer should choose a return strategy and show that the handling return loss and the customer return cost in each channel are critical factors that should be considered by the retailer and manufacturer when choosing a return strategy. In addition, the retailer should cooperate with the manufacturer to establish an offline-to-online (O2O) omnichannel to fully benefit from the convenience and advantages of the retail channel. We find that the adoption of the O2O strategy by the retailer in its retail channel always generates profits, while the manufacturer may implement the O2O strategy in its direct channel when the profit from the Internet service is higher than a threshold. Additionally, the impact of various strategies on pricing, market share, and profits is discussed.

scholarly journals The Impact of Price Comparison Service on Pricing Strategy in a Dual-Channel Supply Chain

2013 ◽  
Vol 2013 ◽  
pp. 1-13 ◽  
Author(s):  
Qi Xu ◽  
Zheng Liu ◽  
Bin Shen
Keyword(s):  
Supply Chain ◽  
Numerical Study ◽  
Profit Maximization ◽  
Pricing Strategy ◽  
Optimal Pricing ◽  
Pricing Strategies ◽  
Price Comparison ◽  
Dual Channel ◽  
Dual Channel Supply Chain ◽  
The Impact

Recently, price comparison service (PCS) websites are more and more popular due to its features in facilitating transparent price and promoting rational purchase decision. Motivated by the industrial practices, in this study, we examine the pricing strategies of retailers and supplier in a dual-channel supply chain influenced by the signals of PCS. We categorize and discuss three situations according to the signal availability of PCS, under which the optimal pricing strategies are derived. Finally, we conduct a numerical study and find that in fact the retailers and supplier are all more willing to avoid the existence of PCS with the objective of profit maximization. When both of retailers are affected by the PCS, the supplier is more willing to reduce the availability of price information. Important managerial insights are discussed.

Pricing Strategies in Dual-Channel Supply Chain with Retailer Direct Marketing

2014 ◽  
Vol 933 ◽  
pp. 902-906 ◽  
Author(s):  
Shu Juan Li ◽  
Ai Jun Liu
Keyword(s):  
Supply Chain ◽  
Direct Marketing ◽  
Chain Model ◽  
Pricing Strategies ◽  
Direct Channel ◽  
Dual Channel ◽  
Supply Chain Model ◽  
Brand Promotion ◽  
The Difference ◽  
Dual Channel Supply Chain

A two-level dual-channel supply chain model was established in which retailer had his own direct channel. Game model was constructed based on two cases of decentralized and centralized decision-making. Pricing strategies of manufacturer and retailer were studied. Impacts of different channel and different sale entities on manufacturer and retailer were examined. Results show that when channel substitution increases and market share of retailer direct channel is small, retailer should choose to give up direct channel and focus on retail channel sales and take direct channel as means of propaganda and brand promotion. When the difference of sale entities reduces, consumers can get more surplus.

scholarly journals Pricing Strategies in Dual-Channel Supply Chain with a Fair Caring Retailer

Complexity ◽  
2019 ◽  
Vol 2019 ◽  
pp. 1-23 ◽  
Author(s):  
Lufeng Dai ◽  
Xifu Wang ◽  
Xiaoguang Liu ◽  
Lai Wei
Keyword(s):  
Supply Chain ◽  
Stackelberg Game ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Equilibrium Solutions ◽  
Channel Competition ◽  
Dual Channel ◽  
Fairness Concerns ◽  
Dual Channel Supply Chain ◽  
The Impact

Manufacturers add online direct channels that inevitably engage in channel competition with offline retail channels. Since price is an important factor in consumers' choice of purchasing channel, pricing strategy has become a popular topic for research on dual-channel competition and coordination. In contrast to previous research on pricing strategies based on the full rationality of members, we focus on the impact of retailers' fairness concerns on pricing strategies. In this study, the hybrid dual-channel supply chain consists of one manufacturer with a direct channel who acts as the leader and a retailer who acts as the follower. First, we use the Stackelberg game approach to determine the equilibrium pricing strategy for a fair caring retailer. Simultaneously, we consider a centralized dual-channel supply chain as the benchmark for a comparative analysis of the efficiency of a decentralized supply chain. Furthermore, we study pricing strategies when the retailer has fairness concerns and determine the complete equilibrium solutions for different ranges of the parameters representing cross-price sensitivity and fairness. Finally, through numerical experiments, the pricing strategies, the profit and utility of the manufacturer and retailer, and the channel efficiency of the supply chain are compared and analysed for two scenarios. We find that fairness concerns reduce the manufacturer's profits, while for the most part, the retailers’ profit can be improved; however, the supply chain cannot achieve complete coordination.

Optimal Independent Pricing Strategies of Dual-Channel Supply Chain Based on Risk-Aversion Attitudes

2018 ◽  
Vol 35 (02) ◽  
pp. 1840004 ◽  
Author(s):  
Zheng Liu ◽  
Qi Xu ◽  
Kun Yang
Keyword(s):  
Supply Chain ◽  
Risk Aversion ◽  
Risk Attitude ◽  
Substitution Effect ◽  
Pricing Strategies ◽  
Supply Chain System ◽  
Dual Channel ◽  
Dual Channel Supply Chain ◽  
The Impact ◽  
Independent Model

Dual-channel supply chain system, channel optimization is influenced by channel attitude toward risk, in which risk is classified as general risk and interruption risk. To consider lead time may bring out supply conflicts, substitution effect of online channel and ratio of promotional cost are introduced and an independent model is developed. Based on that, the impact of interruption risk under risk-aversion attitude on both channels is further studied. Finally, it is proved how the risk attitude influences pricing and profit strategy.

Equal Pricing Strategies in a Dual Channel Supply Chain

2013 ◽  
pp. 230-249 ◽  
Author(s):  
Ue-Pyng Wen ◽  
Yun-Chu Chen ◽  
Kam-Hong Cheung
Keyword(s):  
Supply Chain ◽  
Service Quality ◽  
Wholesale Price ◽  
Retail Price ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Direct Channel ◽  
Cooperative Strategy ◽  
Dual Channel ◽  
Dual Channel Supply Chain

In this article, equal pricing strategies are studied in a dual channel supply chain where a manufacturer sells to a retailer as well as to consumers through a direct channel according to the assumption that the manufacturer commits setting the same retail price as the traditional channel to reduce the channel’s conflict. The authors first analyze the effect of different pricing strategies on the retail price, wholesale price and profits. The cooperative strategy is also studied to see how it benefits both parties in the dual channel supply chain. Finally, through a numerical example, it is demonstrated that providing convenience of the direct channel is important for the manufacturer and service is a distinctive advantage for the retailer. Furthermore, the paper shows that if the service quality has a significant effect on the direct channel, then the manufacturer tends to abandon commitment of equal pricing strategy.

scholarly journals A Particle Swarm Optimization Algorithm for Solving Pricing and Lead Time Quotation in a Dual-Channel Supply Chain with Multiple Customer Classes

2020 ◽  
Vol 2020 ◽  
pp. 1-21
Author(s):  
Mahboobeh Honarvar ◽  
Majid Alimohammadi Ardakani ◽  
Mohammad Modarres
Keyword(s):  
Particle Swarm Optimization ◽  
Supply Chain ◽  
Optimization Algorithm ◽  
Particle Swarm Optimization Algorithm ◽  
Direct Channel ◽  
Due Date ◽  
Swarm Optimization ◽  
Dual Channel ◽  
Retail Channel ◽  
Dual Channel Supply Chain

The combination of traditional retail channel with direct channel adds a new dimension of competition to manufacturers’ distribution system. In this paper, we consider a make-to-order manufacturer with two channels of sale, sale through retailers and online direct sale. The customers are classified into different classes, based on their sensitivity to price and due date. The orders of traditional retail channel customers are fulfilled in the same period of ordering. However, price and due date are quoted to the online customers based on the available capacity as well as the other orders in the pipeline. We develop two different structures of the supply chain: centralized and decentralized dual-channel supply chain which are formulated as bilevel binary nonlinear models. The Particle Swarm Optimization algorithm is also developed to obtain a satisfactory near-optimal solution and compared to a genetic algorithm. Through various numerical analyses, we investigate the effects of the customers’ preference of a direct channel on the model’s variables.

Equal Pricing Strategies in a Dual Channel Supply Chain

2011 ◽  
Vol 2 (4) ◽  
pp. 34-51 ◽  
Author(s):  
Ue-Pyng Wen ◽  
Yun-Chu Chen ◽  
Kam-Hong Cheung
Keyword(s):  
Supply Chain ◽  
Service Quality ◽  
Wholesale Price ◽  
Retail Price ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Direct Channel ◽  
Cooperative Strategy ◽  
Dual Channel ◽  
Dual Channel Supply Chain

In this article, equal pricing strategies are studied in a dual channel supply chain where a manufacturer sells to a retailer as well as to consumers through a direct channel according to the assumption that the manufacturer commits setting the same retail price as the traditional channel to reduce the channel’s conflict. The authors first analyze the effect of different pricing strategies on the retail price, wholesale price and profits. The cooperative strategy is also studied to see how it benefits both parties in the dual channel supply chain. Finally, through a numerical example, it is demonstrated that providing convenience of the direct channel is important for the manufacturer and service is a distinctive advantage for the retailer. Furthermore, the paper shows that if the service quality has a significant effect on the direct channel, then the manufacturer tends to abandon commitment of equal pricing strategy.

scholarly journals Price and Service Competition of Dual-Channel Supply Chain with Consumer Returns

2014 ◽  
Vol 2014 ◽  
pp. 1-10 ◽  
Author(s):  
Lili Ren ◽  
Yong He ◽  
Houfei Song
Keyword(s):  
Supply Chain ◽  
Retail Industry ◽  
Direct Channel ◽  
Service Competition ◽  
Consumer Returns ◽  
Optimal Decisions ◽  
Dual Channel ◽  
Retail Channel ◽  
Additional Costs ◽  
Dual Channel Supply Chain

Products returned by consumers are common in the retail industry and result in additional costs to both the manufacturer and the retailer. This paper proposes dual-channel supply chain models involving consumer returns policies. Also, the price and service competition between retail channel and direct channel is considered in the models. According to the models, we analyze the optimal decisions in both centralized and decentralized scenarios. Then we design a new contract, coordinate the dual-channel supply chain, and enable both the retailer and the manufacturer to be a win-win.

scholarly journals Pricing Policies in a Retailer Stackelberg O2O Green Supply Chain

2020 ◽  
Vol 12 (8) ◽  
pp. 3236
Author(s):  
Gan Wan ◽  
Gang Kou ◽  
Tie Li ◽  
Feng Xiao ◽  
Yang Chen
Keyword(s):  
Supply Chain ◽  
Stackelberg Game ◽  
Good Combination ◽  
Green Supply Chain ◽  
Game Model ◽  
Mathematical Function ◽  
Pricing Strategies ◽  
Direct Channel ◽  
Retail Channel ◽  
Offline Channels

Due to the popularization of the concept of “new retailing”, we study a new commercial model named O2O (online-to-offline), which is a good combination model of a direct channel and a traditional retail channel. We analyze an O2O supply chain in which manufacturers are responsible for making green products and selling them through both online and offline channels. The retailer is responsible for all online and offline channels’ orders, and the manufacturer gives the retailer a fixed fee. We construct a mathematical function model and analyze the greenness and pricing strategies of centralized and decentralized settings through the retailer Stackelberg game model. Due to the effects of the double marginalization of supply chain members, we adopt a simple contract to coordinate the green supply chain. The paper’s contributions are that we obtain pricing and greening strategies by taking the cooperation of offline channels and online channels into consideration under the O2O green supply chain environment.

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