T his paper studies the impact of supply reliability on a retail firm's performance under joint marketing and inventory decisions. The firm sells a product in a single selling season and can exert marketing effort to influence consumer demand. We develop a modeling framework to quantify the value of improving supply reliability and investigate how this value depends on different model parameters. Our results provide useful insights into how firms should make investment decisions on adopting new technologies to improve supply reliability. First, we establish a necessary and sufficient condition under which the maximum unit cost a firm is willing to pay to improve supply reliability increases in product price. We further show that this condition would hold in most practical situations. Thus, with some caveats, our result supports the intuition that a firm is willing to pay more to improve supply reliability for products with a higher price. Next, we show that for two products with the same price, a firm is willing to pay more to improve supply reliability for the product with a higher product cost. This implies that it is not necessarily true that emerging technologies for improving supply reliability should be first adopted for products with the highest unit contribution margin. Finally, we show that a product with a lower marketing cost function always benefits more from improved supply reliability than a product with a higher marketing cost function. This finding suggests that the priority of adopting new technologies should be given to situations where the firm can effectively induce greater demand through promotional effort.

No abstract

No abstract

This paper introduces a new approach to probing intermolecular interactions based on a framework of two-dimensional (2D) synchronous spectroscopy. Mathematical analysis performed on 2D synchronous spectra using variable concentration as an external perturbation shows that the cross-peaks are composed of two parts. The first part reflects intermolecular interactions that manifest in the form of deviation from the Beer-Lambert law. The second part is related simply to the concentration variations of the solutes and is responsible for the generation of interfering cross-peaks not related to the intermolecular interactions in the system. It is the second part that prevents the reliable identification of intermolecular interactions. We propose a way of selecting the concentrations of solutes so that the resultant dynamic concentration vectors of different solutes become orthogonal to one another. Therefore, the contribution of the second part to the cross-peaks can be effectively removed by the dot product of orthogonal vectors. Our new approach has been tested on a simulated chemical system and a real chemical system. The results demonstrate that interfering cross-peaks can be successfully removed from a 2D synchronous spectrum so that the cross-peaks can be used as a reliable tool to characterize or probe intermolecular interactions.