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Article
Publication date: 22 November 2023

Chen-hao Wang, Yong Liu and Zi-yi Pan

The paper attempts to discuss the impact of reference price effect on pricing decisions.

Abstract

Purpose

The paper attempts to discuss the impact of reference price effect on pricing decisions.

Design/methodology/approach

With the growth of the Internet and e-commerce, more and more customers purchase products in through online channels and choose products by comparing different prices and services, and the reference price effect has an impact on pricing decisions. To investigate the impact of consumers' reference price effect on the dual-channel supply chain, the authors establish a basic model consisting of a single dominant manufacturer and a single downstream retailer, and analyze the optional decisions under different situations and discuss the influence of reference price effect. Finally, a number case verifies the validity and rationality of the proposed model.

Findings

The results show that (1) the reference price effect has varying effects on the price, channel demand and income of manufacturers and retailers in the channel depending on the role of customers' channel preferences. (2) The manufacturer's online channel demand and profits always increase with the reference pricing effect, whereas the retailer's offline demand and profits always decline. (3) When the proportion of consumers preferring offline is higher, the manufacturer's network price and wholesale price increase with the reference price effect, while the retailer's retail price decreases with the reference price effect; when the proportion of consumers preferring offline is lower, the opposite is true, and the centralized decision results are consistent with the decentralized decision results.

Practical implications

This paper can clarify the impact of consumer reference price effects on the operation of dual-channel supply chains, and help inform pricing decisions of manufacturers and retailers in dual-channel supply chains.

Originality/value

The proposed approach can well analyze the impact of consumer reference price effect and give channel their optional decisions.

Details

Asia Pacific Journal of Marketing and Logistics, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1355-5855

Keywords

Article
Publication date: 5 February 2024

Yong Liu, Chang-Xue Lin and Gang Zhao

The paper attempts to discuss the optimal pricing decisions under the decentralized and centralized decision and analyze the influence of online reviews and in-sale service on…

Abstract

Purpose

The paper attempts to discuss the optimal pricing decisions under the decentralized and centralized decision and analyze the influence of online reviews and in-sale service on dual-channel supply chain. Finally, the authors design a two-part tariff coordination mechanism.

Design/methodology/approach

To deal with this pricing conflict problems of dual-channel supply chain consisting of dominant manufacturer and a retailer, considering the fact that online reviews and in-sale service are important factors on consumers’ purchase decisions, the authors establish some basic models and exploit them to discuss the optimal pricing decisions under the decentralized and centralized decision and analyze the influence of online reviews and in-sale service on dual-channel supply chain. Finally, the authors design a profit-sharing coordination mechanism.

Findings

The results show that the optimal online direct selling price is positively correlated with product perceived quality obtained from online reviews and negatively correlated with the in-sale service. The traditional retail price is positively correlated with the in-sale service and weakly correlated with online reviews. For the manufacturer and retailer, whether decentralized decision or coordination contract, their profits increase with the increase of the in-sale service in a certain range and quality perceived from spontaneous online reviews. Online reviews and in-sale service are important factors on consumers’ purchase decisions. Positive in-sale services and online reviews can provide consumers with a better shopping experience, thereby promoting their enthusiasm for shopping and improving their quality of life. The two-part tariff coordination mechanism improves the profits of the manufacturer and the traditional retailer, respectively, through the transfer fee.

Originality/value

The proposed approach can well analyze the channel conflicts and pricing problems between retailers and manufacturers with respect to product offline price and online price. The analysis and results can inform decision-making for manufacturers and retailers.

Details

Journal of Business & Industrial Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0885-8624

Keywords

Article
Publication date: 12 March 2024

Yanping Liu, Bo Yan and Xiaoxu Chen

This paper studies the optimal decision-making and coordination problem of a dual-channel fresh agricultural product (FAP) supply chain. The purpose is to analyze the impact of…

Abstract

Purpose

This paper studies the optimal decision-making and coordination problem of a dual-channel fresh agricultural product (FAP) supply chain. The purpose is to analyze the impact of information sharing on optimal decisions and propose a coordination mechanism to encourage supply chain members to share information.

Design/methodology/approach

The two-echelon dual-channel FAP supply chain includes a manufacturer and a retailer. By using the Stackelberg game theory and the backward induction method, the optimal decisions are obtained under information symmetry and asymmetry and the coordination contract is designed.

Findings

The results show that supply chain members should comprehensively evaluate the specific situation of product attributes, coefficient of freshness-keeping cost and network operating costs to make decisions. Asymmetric information can exacerbate the deviation of optimal decisions among supply chain members and information sharing is always beneficial to manufacturers but not to retailers. The improved revenue-sharing and cost-sharing contract is an effective coordination mechanism.

Practical implications

The conclusions can provide theoretical guidance for supply chain managers to deal with information asymmetry and improve the competitiveness of the supply chain.

Originality/value

This paper combines the three characteristics that are most closely related to the reality of supply chains, including horizontal and vertical competition of different channels, the perishable characteristics of FAPs and the uncertainty generated by asymmetric demand information.

Details

International Journal of Retail & Distribution Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0959-0552

Keywords

Article
Publication date: 21 August 2023

Jingyi Shi and Yanting Huang

As an important form of the e-commerce industry, online group buying is under the spotlight from with two sides: cheaper price but longer waiting time. The purpose of this paper…

Abstract

Purpose

As an important form of the e-commerce industry, online group buying is under the spotlight from with two sides: cheaper price but longer waiting time. The purpose of this paper is to adequately investigate the interaction between saving and waiting time of group buying comprehensively.

Design/methodology/approach

To fill the research gap, the authors elaborate a dual-channel supply chain (SC) with regular retail (individual buying) and group-buying channel, and formulate the demand based on the consumer utility with the positive effect of saving money and the negative effect of wasting time.

Findings

The authors find that power structure only changes the optimal prices, instead of the waiting time. The selling price mainly influences consumer demands, instead of the price discount of group buying. The SC profits are only positive to the channel preference, and it is the decisive parameter of consumers' choice. The price sensitivity lays a more remarkable impact on the SC compared to the time sensitivity. Above all, the price is the main factor of group buying, instead of time.

Originality/value

These results underscore the improvement for the dual-channel SC of group buying, providing managerial insights for the group-buying industry.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 25 December 2023

Peng Ma, Qin Yuan and Henry Xu

Previous studies have rarely integrated the financing modes of a capital-constrained manufacturer with the choices of online sales strategies. To address this gap, the authors…

Abstract

Purpose

Previous studies have rarely integrated the financing modes of a capital-constrained manufacturer with the choices of online sales strategies. To address this gap, the authors study how a manufacturer selects optimal financing modes under different sales strategies in three dual-channel supply chains.

Design/methodology/approach

This paper considers three sales strategies, namely, combining a traditional retailer channel with one of the direct selling, reselling and agency selling channels, and two common financing modes, namely, bank financing and retailer financing. The authors obtain equilibrium outcomes of the manufacturer and traditional retailer and then provide the conditions for them to select optimal financing modes under three sales strategies.

Findings

The results indicate that the manufacturer’s financing decisions rely on the initial capital and interest rates, and the manufacturer selects retailer financing only if the initial capital is relatively larger. In terms of financing mode options, the retailer financing mode is more beneficial for the manufacturer under the three sales strategies. From the perspective of sales strategies, the direct selling model is more beneficial. In addition, the higher the consumer acceptance of the online channel, the more profits the manufacturer obtains.

Practical implications

This paper provides suggestions on how the capital-constrained manufacturer chooses financing modes and sales strategies.

Originality/value

This paper integrates the financing mode and different sales strategies to investigate the manufacturer’s optimal operational decisions. These sales strategies allow us to investigate the manufacturer’s optimal financing modes in the presence of both different financing modes and sales strategies.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 17 March 2023

Qi Sun, Yaya Gao, Qihui Lu and Yingyi Yan

Different external supply scenarios faced by the retailers will affect their choice of strategy when supply is disrupted and becomes far less than demand, urgently. This study…

Abstract

Purpose

Different external supply scenarios faced by the retailers will affect their choice of strategy when supply is disrupted and becomes far less than demand, urgently. This study focuses on analyzing both demand and supply side response strategies to meet customer demand and reduce the impact of the shortage during supply disruptions.

Design/methodology/approach

According to the quantity of products that the external market can provide, the external supply scenarios were divided into sufficient-type external supply and learning-type external supply. A two-echelon perishable goods supply chain was analyzed, and three kinds of contingency strategy models for downstream retailers were investigated. First, in the sufficient external supply scenario, the optimal price and transshipment quantity to maximize retailer's profits is discussed. Second, in the scenario of learning-type external supply, this study analyzes the optimal decision in three mechanisms of the hybrid strategy and their application: price priority mechanism, quantity priority mechanism and price–quantity balance mechanism. Furthermore, the influence of penalty cost and supply on the priority orders of different mechanisms was studied.

Findings

Results show that comparing the two pure strategies (pricing strategy and transshipment strategy)it was noted that the hybrid strategy produces the best results in sufficient-type external supply scenario. In the learning-type external supply scenario, a numerical study has shown the existence of three areas in case of penalty cost and supplier's capacity, and each areas has different priority orders of the three mechanisms. Under the situation of learning external supply, the retailer's optimal strategy is affected by parameters such as penalty cost and supply volume.

Originality/value

The main innovation of the work lies in the following: First; the external supply situation was divided into sufficiency type and learning type, which improves the external situation faced by retailers after the outbreak of emergencies, helps retailers understand the external situation, conforms to the actual situation and has certain practical application value. Second; in the context of learning external supply, there are three coping strategies for retailers, including: Price priority mechanism, Quantity priority mechanism and Pricing and transshipment balance mechanism. This will help retailers make strategic choices, make more scientific management decisions and improve the supply chain emergency management theory. Third; the demand side response was managed through the change of external supply during supply side recovery period and supply disruption. The proposed model enables managing and analyzing supply disruption efficiently and effectively via handling uncertainty by considering all aspects of decision-making process. The proposed model can be applied in various fields such as vegetable and fruit, fresh food, etc.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 13 November 2023

Wen Zhang and Mingzhuo Dai

The purpose of this study is to explore the interplay between the selection of selling formats of remanufactured products for a third-party remanufacturer (TPR) and the quality…

Abstract

Purpose

The purpose of this study is to explore the interplay between the selection of selling formats of remanufactured products for a third-party remanufacturer (TPR) and the quality decision of an original equipment manufacturer (OEM).

Design/methodology/approach

This study considers a remanufacturing supply chain, where the OEM sells new products through a platform retailer, but the products remanufactured by the TPR can be sold via a direct or indirect channel. The authors model a Stackelberg game and explore the optimal quality decision of the OEM and selling format choice of the TPR.

Findings

The OEM's optimal decision depends mainly on consumers' discounted utility coefficient and cost-scale factor of remanufactured products. A higher consumers' valuation of the remanufactured product will not result in a higher retail price, but may lead to an increase in new product's sales. Given the cost-scale factor, the TPR prefers to sell directly no matter what the value of consumers' discounted utility coefficient is. An all-win situation is achieved with selling directly when consumers' discounted utility coefficient is sufficiently large.

Practical implications

These results provide some support to the operational strategies of the OEM and TPR.

Originality/value

This study firstly endogenizes the quality decision and combines the selling format selection of the TPR and the quality decision of the OEM to explore the interplay between these two important decisions.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 14 September 2023

Yongchang Jiang, Hejie Zhu and E. Bai

The existence of the advertising delay effect and its impact on supply chain operations have been demonstrated in the current study. Therefore, this study develops a timely…

Abstract

Purpose

The existence of the advertising delay effect and its impact on supply chain operations have been demonstrated in the current study. Therefore, this study develops a timely inventory control strategy for the fresh produce supply chain to address the advertising delay effect in the fresh produce supply chain.

Design/methodology/approach

This study proposes a game model based on the Nerlove-Arrow time delay differential equation and Pontryagin's maximum principle. Through comparative analyses of the optimal equilibrium strategies, the authors compare the optimal equilibrium strategies, product goodwill and optimal inventory trajectories for suppliers and retailers under secondary replenishment decisions and decentralized decisions.

Findings

The authors find that (1) Only when the sales cycle meets certain conditions can the overall profit of the supply chain under the secondary replenishment decision be greater than that under the decentralized decision. As the price markup coefficient increases, the total profit of the supply chain first increases and then decreases. (2) With the increase in the delay time, the replenishment quantity during the initial period gradually decreases. After the delay time elapses, the inventory depletion rate under secondary replenishment decisions is faster than that under decentralized decision-making. (3) Although there is a continuously increasing maximum value of product goodwill with the increase in delay time, it becomes difficult to achieve this value for longer delays.

Practical implications

The authors’ findings provide a theoretical basis for supply chain members of fresh agricultural products to select replenishment and inventory control strategies when adopting different levels of delay in advertising marketing.

Originality/value

Firstly, this paper explains the impact of advertising delay effect on fresh produce supply chain from a dynamic perspective, and secondly, it provides guidance on advertising formulation and inventory replenishment for fresh produce retailers under the influence of advertising delay effect.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 18 July 2023

Miaomiao Wang, Xinyu Chen, Yuqing Tan and Xiaoxi Zhu

To explore how the blockchain affects the pricing and financing decisions in a low-carbon platform supply chain.

194

Abstract

Purpose

To explore how the blockchain affects the pricing and financing decisions in a low-carbon platform supply chain.

Design/methodology/approach

Considering the dual roles of the e-commerce platform as a seller and an initiator, a typical game-theoretical method is applied to analyze the behavior of supply chain decision-makers and the impact of key variables on equilibriums.

Findings

When loan interest rates are symmetric, whether blockchain is used or not, the e-commerce platform financing mode will always produce higher wholesale price and unit carbon emission reduction, while the retail price is the opposite. Higher unit additional income brought by the blockchain can bring higher economic and environmental performances, and the e-commerce platform financing mode is superior to bank financing mode. The application of blockchain may cause the manufacturer to change his/her financing choice. For bank financing, with the increase of loan interest rates, the advantages brought by blockchain will gradually disappear, but this situation will not occur under e-commerce platform financing.

Originality/value

Blockchain is known for its information transparency properties and its ability to enhance user trust. However, the impacts of applying blockchain in a low-carbon platform supply chain with different financing options are not clear. The authors examine the manufacturer's strategic choices for platform financing and bank financing, whether to adopt blockchain, and the impact of these decisions on carbon emissions reduction, consumer surplus and social welfare. The research conclusion can provide reference for the operation and financing decisions of platform supply chain under the carbon reduction target in the digital economy era.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

Article
Publication date: 14 November 2023

Fan Ding, Zhangping Lu and Jingxian Chen

Contract Manufacturers (CM, factory) can cultivate factory brand products by imitating Original Equipment Manufacturers' (OEM, brand owner) National Brand products, and compete…

66

Abstract

Purpose

Contract Manufacturers (CM, factory) can cultivate factory brand products by imitating Original Equipment Manufacturers' (OEM, brand owner) National Brand products, and compete with OEM through the online retailer, that is, factory encroachment. In practice, few consumers can identify the quality of those two products in the online market. Implementing blockchain technology (BTI) can help all consumers identify product quality but may change the operation decisions and incur implementation costs. This study aims to explore how will the BTI strategies affect participants' operation performance under the factory encroachment and delve into the decisions regarding NB product quality and CM encroachment.

Design/methodology/approach

This study constructs a three-level outsourcing supply chain comprising one contract manufacturer (CM, factory), one original equipment manufacturer (OEM) and one online retailer. By utilizing the Stackelberg game, the authors first compared the results between two strategic decisions of BTI and no-BTI by online retailers under the factory encroachment scenario. Then, the NB product quality decision and the CM's encroachment decision are also investigated.

Findings

BTI strategy can benefit all participants (triple win), which both occurs in exogenous and endogenous quality cases, and the triple win area will expand (shrink) as the BTI cost decreases (increases). In addition, the OEM will improve product quality to confront competition from the CM, and the OEM may not always benefit from the BTI, it depends on the maturity of the market. Interestingly, BTI could improve the consumer surplus when the proportion of novice consumers is low. Finally, this study also investigates the extended case that CM always encroaches into the market whether the online retailer choose BTI or not, which hurts OEM's profit and decreases the product quality.

Originality/value

This study sheds light on the strategic decisions of online retailers' BTI regarding supply chain members' profits, consumer surplus and social welfare under factory encroachment. It also demonstrates that the BTI strategy, under different quality decisions (endogenous and exogenous), can be more profitable for chain members and consumers.

Details

Kybernetes, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0368-492X

Keywords

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