Pricing Decisions In A Dual-channel Supply Chain Considering Customized Products

In recent years,with the development of the Internet and logistics technology,the dualchannel sales mode is more and more popular.The prices and service levels decided by the decision-makers influence the purchasing decisions of consumers.Meantime,with the rapid development of economics and the improvement of living standards,the demands of consumers are gradually becoming personalized.Some companies try to produce customized products for consumers.The diversity of products and sales channels promotes the upgrading of products,and large quantities of used products appear.Driven by environmental protection awareness and supported by relevant laws and regulations,many companies try to form the closed-loop supply chain,which promotes the reuse of resources and saves production costs.In a dual-channel supply chain with product customization,the manufacturer sells standard products and customized products via the online channel,and the retailer sells standard products offline.Considering the pricing and service level decisions,three game models are proposed:(1)the manufacturer Stackelberg model;(2)the retailer Stackelberg model;(3)the Nash model,and the equilibrium solutions are derived.Besides,considering the recycling of used products,a dual-channel closed-loop supply chain under the manufacturer collecting mode,the retailer collecting mode,and the joint collecting mode are modeled and the equilibrium solutions are derived.Then,the impacts of price competition and service competition,as well as service cost and other factors on decisions and profit in the dual-channel supply chain under different bargaining power structures are analyzed.Next,the impacts of the customer preference for customization and the customer loyalty to the retail channel of standard products on decisions and profits are investigated,and the three collection modes are compared.Through the numerical analysis,some important conclusions are concluded.First,when the price competition is fierce,the manufacturer should focus on the market strategy of standard products and lower the level of customization;when the service competition is fierce,the manufacturer should improve standard product services and reduce service expenditure for customized products.Second,when the service cost coefficient of the manufacturer is high,he should reduce the level of customization and the service level of customized products.Third,when the manufacturer leads the market,it's beneficial for the sales of customized products and providing better service for them;when the retailer leads the market,the manufacturer should enhance the service level of standard products.Fourth,the customer preference for customized products decides whether the manufacturer should produce customized products or not;the customer loyalty to the retail channel of standard products decides the timing of selling standard products online.Finally,in a real commercial environment of the dual-channel closed-loop supply chain with customized products,the decision-makers should try to recycle used products via multiple recycling channels,then consider collecting used products by the retailer.