Supply chain pricing strategies for advance selling with a deposit

Author:

Lyu Qi1,Wu Shuang12,Li Bo1,Zhang Yawen3

Affiliation:

1. College of Management and Economics, Tianjin University , Tianjin 300072 , China

2. Management School, Hainan University , Haikou 570228 , China

3. Beijing E-Hualu Information Technology Co., Ltd. , Beijing 100043 , China

Abstract

Abstract Accepted by: Konstantinos Nikolopoulos This research studies the pricing strategy of a supply chain with a manufacturer and a retailer. We analyze the customers’ purchase behaviour in advance selling with deposit by using utility theory and obtain the pricing decision of the supply chain by using the Stackelberg model. We find that when consumers are not sensitive to the distribution lead time, the retailer’s advance selling strategy could Pareto improve the whole supply chain. Better informed consumers and moderate advance selling distribution lead time information could expand the retailer’s pre-sale possibilities by enlarging the feasible range of advance selling.

Funder

Hainan Provincial Natural Science Foundation of China

University Scientific Research Project of Hainan Science and Technology Department

Publisher

Oxford University Press (OUP)

Subject

Applied Mathematics,Management Science and Operations Research,Strategy and Management,General Economics, Econometrics and Finance,Modeling and Simulation,Management Information Systems

Reference34 articles.

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4. Lead-time quotations in unobservable make-to-order systems with strategic customers: risk aversion, load control and profit maximization;Benioudakis;Eur. J. Oper. Res.,2021

5. Pricing in make-to-order firms with a lead time-dependent cost;Cai;IMA J. Manag. Math.,2023

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