Pricing and assortment decisions for a manufacturer selling through dual channels

Rodriguez, Betzabe; Aydın, Göker

doi:10.1016/j.ejor.2014.10.047

Cited by 76 publications

(22 citation statements)

References 26 publications

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“…Many scholars suppose the additional channel would raise the profit of manufacturer due to the additional source of income, but reduce the profit of manufacturer because of the channel conflict (Xiao et al 2014). According to this view, the manufacturer needs to consider the conflict and coordination problems between retailing channels (Rodrłguez and Aydın 2015;Chen et al 2013;Hsieh et al 2014;Cai et al 2009;Xiao et al 2005;Desai 1992; Amrouche and Yan 2015 etc. ).…”

Section: Pricing In Dual-channel Supply Chainmentioning

confidence: 99%

Pricing and bargaining strategy of e-retail under hybrid operational patterns

Han

Cao

et al. 2016

Ann Oper Res

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Dual-channel, as a significant retail strategy, has got more and more attention for academia and industry. While most literature focus on the conflicts between traditional channel and online channel, there are few works consider the conflicts of online retail channels. This paper focuses on the pricing and bargaining strategy of manufacturer and e-retailer under hybrid operational patterns which are adopted by e-commerce platforms. The operational patterns are divided into two types: other-organization e-pattern, such as Amazon, and self-organization e-pattern, such as Alibaba. We consider the commission charge which is collected by self-organization e-platform; and the analysis reveals that a fixed commission only has an effect on the total profit of manufacturer, but a variable commission would influence the wholesale price of other-organization e-platform and e-retail prices of both e-platforms, respectively. The results also suggest that, the wholesale price and the e-retail price are both affected by the service quality and this effect is also influenced by the variable commission. In addition, we also discuss the possibility of the manufacturer and e-retailer adjust their pricing strategy based on big data implementation.

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Section: Pricing In Dual-channel Supply Chainmentioning

confidence: 99%

Pricing and bargaining strategy of e-retail under hybrid operational patterns

Han

Cao

et al. 2016

Ann Oper Res

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“…Moreover, a number of studies appear to focus on coordination and conflict between direct marketers and conventional intermediaries such as retailers, typically analyzing the economic impacts of the introduction of the direct Internet channel (e.g., Balasubramanian, 1998;Chiang et al, 2003;Tsay and Agrawal, 2004a;Liu, 2003, 2005;Chiang and Monahan, 2005;Yao et al, , 2009Cattani et al, 2006;Liu et al, 2006;Kurata et al, 2007;Bernstein et al, 2008;Dumrongsiri et al, 2008;Huang and Swaminathan, 2009;Chiang, 2010;Hua et al, 2010;Khouja and Wang, 2010;Chen et al, 2013;Hsiao and Chen, 2013;Carrillo et al, 2014;Xiao et al, 2014;Khouja and Zhou, 2015;Li et al, 2015;Rodríguez and Aydın, 2015;Yan et al, 2015). Balasubramanian (1998) investigates the competition between direct marketers and conventional retailers by considering the adaptability of products to the direct sales channel and the product information revealed to customers.…”

Section: Literature Reviewmentioning

confidence: 99%

“…They propose optimal launch strategies and pricing decisions for the e-book supply chain. Rodríguez and Aydın (2015) study the pricing and assortment decisions in dual-channel supply chains, where the retailer offers a subset of the assortment that the manufacturer offers through its direct channel. They highlight the possibility that the manufacturer's and retailer's assortment preferences are in conflict, where the manufacturer prefers the retailer to carry items with high demand variability while the retailer prefers items with low demand variability.…”

Section: Literature Reviewmentioning

confidence: 99%

Asymmetric product distribution between symmetric manufacturers using dual-channel supply chains

Matsui

2016

European Journal of Operational Research

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“…They proposed two revenue sharing contracts to enable coordination. Rodríguez and Aydin [26] used a nested-logit model to study pricing and assortment decisions in a dual-channel supply chain by only considering the retailer inventory costs and specified no inventory policy. They highlighted a conflict where that the manufacturer prefers that the retailer carries inventory for items with high demand variability, whereas the retailer prefers to carry items with low demand variability.…”

Section: Literature Reviewmentioning

confidence: 99%

Dual-channel supply chain: A strategy to maximize profit

Batarfi

Zanoni

2016

Applied Mathematical Modelling

115

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The rapid pace of e-commerce development has resulted in several manufacturers selling their products online to stay competitive and increase accessibility to their products. This paper investigates the effect of adopting a dual-channel (comprised of a traditional retail channel and a direct online channel) on the performance of a two-level supply chain (manufacturer-retailer). Through this strategy, the manufacturer would like to offer customized products through a direct online channel (i.e. make-to-order), in addition to offering its standard product through the traditional retail channel (i.e. make-to-stock). The objective is to maximize the total profit of the system when this strategy is adopted. A linear demand function is used for both channels in which the demand depends on the selling prices (markup margin), the quoted delivery lead-time, and product differentiation. This investigation is compared to a benchmark scenario, where the supply chain is comprised of a single-channel strategy (retail channel only) where one type of product is offered; the standard product. In both strategies, the paper analyzes the change in the profit, markup margin and the inventory decisions that result from adopting the dual-channel strategy. The findings of this paper demonstrate that adding a customized-product online channel would increase the profit of the centralized supply chain system. However, it created a conflict due to competition between the retail and online channels. A numerical example and sensitivity analysis have been used to demonstrate this effect and to draw specific managerial insights

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Pricing and assortment decisions for a manufacturer selling through dual channels

Cited by 76 publications

References 26 publications

Pricing and bargaining strategy of e-retail under hybrid operational patterns

Pricing and bargaining strategy of e-retail under hybrid operational patterns

Asymmetric product distribution between symmetric manufacturers using dual-channel supply chains

Dual-channel supply chain: A strategy to maximize profit

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