Coordination mechanism of dual-channel supply chains considering retailer innovation inputs

In response to the online channels established by manufacturers, physical retailers are starting to offer innovative services, which will intensify conflicts between manufacturers and retailers. Considering that the conflict will affect the operation efficiency and sustainable development of the supply chain, the coordination mechanism of a dual-channel supply chain has been established. In this study, we construct the Stackelberg game model based on consumer utility theory to analyze the complex mechanism of retailers' innovation input level affecting supply chain operation and design the double coordination mechanism. The results show that: (1) an optimal combination of wholesale prices, retail prices and innovation input levels can optimize the operational efficiency of the supply chain, (2) Noncooperation among channel members affects the retailer's product pricing, decreases the market share of the physical channel and increases the market demand of manufacturers, (3) The dual coordination mechanism can alleviate channel conflicts, which can improve the operational efficiency of the supply chain. This study provides several insights on the theory of organizational coordination and sustainable development in conflicts of dual-channel supply chains

TWO-STAGE OLIGOPOLY PRICING WITH DIFFERENTIATED PRODUCT: THE BOSTON FLUID MILK MARKET

By specifying a structural model, the present study estimates different indicators of competitiveness of the fluid milk market, namely average and marginal cost, average profits and price-cost margins, and utility levels for the full, and pre and post Compact time period.Demand and Price Analysis,

Myopic Versus Farsighted Behaviors in a Low-Carbon Supply Chain with Reference Emission Effects

The increased carbon emissions cause relatively climate deterioration and attract more attention of governments, consumers, and enterprises to the low-carbon manufacturing. This paper considers a dynamic supply chain, which is composed of a manufacturer and a retailer, in the presence of the cap-and-trade regulation and the consumers’ reference emission effects. To investigate the manufacturer’s behavior choice and its impacts on the emission reduction and pricing strategies together with the profits of both the channel members, we develop a Stackelberg differential game model in which the manufacturer acts in both myopic and farsighted manners. By comparing the equilibrium strategies, it can be found that the farsighted manufacturer always prefers to keep a lower level of emission reduction. When the emission permit price is relatively high, the wholesale/retail price is lower if the manufacturer is myopic and hence benefits consumers. In addition, there exists a dilemma that the manufacturer is willing to act in a farsighted manner but the retailer looks forward to a partnership with the myopic manufacturer. For a relatively high price of emission permit, adopting myopic strategies results in a better performance of the whole supply chain

Coordinating a Supply Chain With a Manufacturer-Owned Online Channel: A Dual Channel Model Under Price Competition

We consider a dual channel supply chain in which a manufacturer sells a single product to end-users through both a traditional retail channel and a manufacturer-owned direct online channel. We adopt a commonly used linear demand substitution model in which the mean demand in each channel is a function of the prices in each channel.We model each channel as a news vendor problem, with price and order quantity as decision variables. In addition, the manufacturer must choose the wholesale price to charge to the independent retailer. We analyze the optimal decisions for each channel and prove the existence of a unique equilibrium for the system. We compare this equilibrium solution to the solution for an integrated system, in which the manufacturer owns both the online store and the retailer. To enable supply chain coordination, we propose two contract schemes: a modified revenue-sharing contract and gain/loss sharing contract. We show that, in cases where the retail channel has a larger market than the online channel, such contracts enable the manufacturer to maintain price discrimination, selling the products in different channels at different prices. Finally, we perform a comprehensive numerical study to consider the impact of the model parameters on the equilibrium and to demonstrate the performance of the proposed coordination contracts. We conclude that coordination is most critical for products which are highly price sensitive and for systems in which the online and traditional retail channels are not viewed as close substitutes

Coordinating Dual-Channel Supply Chain Under Price Mechanism With Production Cost Disruption

This paper studies a two-stage dual-channel supply chain consisting of one manufacturer and one traditional retailer. The manufacturer has its own online channel when he sells the product to the offline retailer. There exists a Stackelberg game between the manufacturer and the offline retailer, in which the manufacturer is the leader and the retailer is the follower. The manufacturer abandons the pricing right in the online channel and adopts the marketing strategy which the online retail price is equal to the offline one. When the supply chain is in a static (undisrupted) condition, it can obtain Pareto improvement and eventually be coordinated by a two-part-tariff contract with a one-time transfer payment. When disruptions make the manufacturer’s unit production cost change, we can obtain the retail price, the production quantity and the total supply chain profit under different disruption levels in the centralized supply chain. Then, we find that there are some certain robustness both in the manufacturer’s production quantity and in the offline retail price. When the supply chain is decentralized, we can coordinate the supply chain by changing the wholesale price according to different disruption levels. Finally, some numerical examples are presented to illustrate the results

Channel Selection and Coordination in Dual-Channel Supply Chains

This paper investigates the influence of channel structures and channel coordination on the supplier, the retailer, and the entire supply chain in the context of two single-channel and two dual-channel supply chains. We extensively study two Pareto zone concepts: channel-adding Pareto zone and contract-implementing Pareto zone. In the channel-adding Pareto zone, both the supplier and the retailer benefit from adding a new channel to the traditional single-channel supply chain. In the contract-implementing Pareto zone, it is mutually beneficial for the supplier and the retailer to utilize the proposed contract coordination policy. The analysis suggests the preference lists of the supplier and the retailer over channel structures with and without coordination are different, and depend on parameters like channel base demand, channel operational costs, and channel substitutability

Structure selection and coordination in dual-channel supply chains

Purpose: This paper investigates the influence of channel structures and channel coordination on the supplier, the retailer, and the entire supply chain in the context of two different kinds of marketing models: the common retailer and the exclusive shop. Design/methodology/approach: With suppliers who manufacture the alternative commodities and retailers in the dual-channel supply chains as the object of the research, this paper compares suppliers' profits, consumer utility without coordination and contrasts suppliers' and retailers' profits with coordination to determine the range of the revenue sharing rates and which parameters are related. Findings: The analysis suggests the preference lists of the supplier and the retailer over channel structures with and without coordination are different, and depend on parameters like channel basic demand, channel cost and channel substitutability. Originality/value: In this research, new sales model for two suppliers should choose the same retailer or the exclusive retailers to sell their commodities.Peer Reviewe

An Efficient Approach for Coordination of Dual-Channel Closed-Loop Supply Chain Management

[EN] In this paper, a closed-loop supply chain composed of dual-channel retailers and manufacturers, a dynamic game model under the direct recovery, and an entrusted third-party recycling mode of the manufacturer is constructed. The impact of horizontal fairness concern behavior is introduced on the pricing strategies and utility of decision makers under different recycling models. The equilibrium strategy at fair neutrality is used as a reference to compare offline retails sales. Research shows that in the closed-loop supply chain of dual-channel sales, whether in the case of fair neutrality or horizontal fairness concerns, the manufacturer's direct recycling model is superior to the entrusted third-party recycling, and the third-party recycling model is transferred by the manufacturer. In the direct recycling model, the horizontal fairness concern of offline retailers makes two retailers in the positive supply chain compete to lower the retail price in order to increase market share. Manufacturers will lower the wholesale price to encourage competition, and the price will be the horizontal fairness concern coefficient, which is negatively correlated. In the reverse supply chain, manufacturers increase the recycling rate of used products. This pricing strategy increases the utility of manufacturers and the entire supply chain system compared to fair neutral conditions, while two retailers receive diminished returns. Manufacturers, as channel managers to encourage retailers to compete for price cuts, can be coordinated through a three-way revenue sharing contract to achieve Pareto optimality.This research was funded by Ministerio de Economia, Industria y Competitividad, Gobierno de Espana grant number BIA2017-87573-C2-2-P.Arshad, M.; Khalid, QS.; Lloret, J.; León Fernández, A. (2018). An Efficient Approach for Coordination of Dual-Channel Closed-Loop Supply Chain Management. Sustainability. 10(10). https://doi.org/10.3390/su10103433S101