Channel Selection And Pricing Decisions Considering Product And Service Competitions

With the improvement of Internet resources and the increase of its popularity rate,ecommerce has developed quickly in China.The enterprises have expanded their business from the traditional offline channels only to including the online channels,which have significantly attracted more demands,optimized consumption structure,and enhanced profit.The introduction of online channels changes the traditional channel structure.Both the upstream enterprises and downstream enterprises should find new equilibriums in the competition.As the diversification and refinement of demand,consumers' appeal for product diversity in the front sales-term and the service requirements affecting the shopping experience in the later sales-term became increasingly prominent,which makes the competition among the supply chain members more complicated.Based on a comprehensive literature review on multiple channels,this dissertation focuses on the studies of channel selection and pricing decision under the influence of product diversity and service factors through developing theoretical models using methodology,such as game theory,optimization theory,customer utility theory,and related theories on supply chain management.This dissertation provides implications with firms in making their operations related decisions.The major findings and conclusions are summarized as follows:Firstly,considering the competitive products in the front stage of sales in the Chapter 3,it discusses the intrusion conditions of manufacturer and the influence of optimal channel selection strategy on the balanced decision of system members,which affects both horizontal competition(between NB and SB products)and vertical competition(between the manufacturer and the retailer).The study shows that the manufacturer is motivated to introduce an online channel as a “margin-oriented strategy” when the consumer's hassle cost of online shopping is relatively low and transportation cost is relatively high.Interestingly,even when there are very few sales in the online channel,an online strategy can be a useful demand-oriented strategy for the manufacturer to mitigate the threat of the retailer's SB,even when the online hassle cost is high while the transportation cost is low.Pareto improvement zones where both the manufacturer and the retailer benefit from the manufacturer's online channel.The retailer should reduce the quality of the SB to further differentiate from the NB product when the manufacturer introduces an online channel.Secondly,Chapter 4 continues to explore the effects of product diversity on the supply chain in the front sales-term,by considering the conflict between direct channel and retail channel which is caused by the substitutability of products between channels.Different from Chapter 3,a game-theoretic model is developed for a supply chain with one manufacturer and one retailer by selling complementary products in Chapter 4.This study analyses manufacturer's entry strategy and the impacts of different supply chain structures on the profits and pricing decisions of supply chain members by considering the complementarity between products and the competitive competition between channels.The impacts of complementary products on the selling strategy and the profits of the system are also discussed.The results show that the dual-channel strategy is the Pareto improvement strategy under certain conditions no matter which pricing policies the manufacturer chooses.The results show that the manufacturers prefer to differentiated prices for two channels to control pricing,at the expense of no sales in the retail channel and zero profit for the retailer;the retailer,however,prefers to the undifferentiated prices to gain more margin profits.The different preferences to the distributions for the upstream and downstream firms are consistent to the market.The research identifies that introducing the complementary products is a useful tool for the retailer to mitigate the threat of the manufacturer's direct channel.Thirdly,Chapter 5 takes into account the increasing emphasis of consumers' interests in the later sales-term,and introduces the logistics service that affect the shopping experience into the supply chain.Chapter 5 discusses manufacturer's channel selection strategy and the effects of manufacturer's channel strategy on the prices and profits.The research finds that when the logistics difference between two channels is relatively small,the price-cut strategy of direct channel attracts more consumers for the manufacturer in the independent logistics model.When the logistics difference is large while the self-sensitivity coefficient is small,it's harmful for the manufacturer to open dual-channel since the fierce market competition,therefore,the single channel is the optimal channel strategy for the manufacturer.When both the logistics difference and self-sensitivity coefficient are large,logistics sharing alliance model can enable the manufacturer to avoid logistics disadvantage,and mitigate the double marginalization of supply chain member.Under certain conditions,a win-win may result from the manufacturer's adoption of dual-channel no matter which logistics model.It is a useful tool for the retailer to defeat manufacturer's entry strategy by keeping its logistics strengths and increasing the gap between two channels' logistics level.Finally,similar to Chapter 5,Chapter 6 continues to explore the effects of the service requirements(returns service)affecting the shopping experience on the supply chain in the later sales-term.Chapter 6 considers a manufacturer with a direct channel needs to decide whether or not to sell its product through a retailer platform,either a reselling or a marketplace contract agreement.This study explores the channel selection strategy of the manufacturer and its selling contract strategy in platform channel.The results show that when the manufacturer introduces a new channel,its profits in the dual-channel strategy is always higher than that in the single channel model because of the expansion of demands.There are two Pareto improvement zones which are beneficial for both the manufacturer and the retailer.While,in those regions which the manufacturer's preferred selling strategy is not preferred by the retailer,the manufacturer need to provide incentives when implementing an optimal selling strategy by negotiating a contract with the retailer.