Bi-Level Programming Models For The Product Pricing Problem In Two-Echelon Dual-Channel Supply Chains

E-commerce in China has experienced stages of e-retailing and e-trade.Now it is entering the stage of shopping online.With the rapid development of Internet, the Internet channel has become an important supplemental channel to the traditional distribution channel. More and more enterprises have provided or prepare to provide their products to customers by both the Internet channel and the traditional distribution channel.When they introduce the Internet channel, they have to face the problem that how to price their products in dual-channel supply chains.This paper studies two-echelon dual-channel supply chains (Two-echelon means a manufacturer and a retailer; dual-channel means the Internet channel and the traditional distribution channel). The manufacturer does not only sell its products by the Internet channel but also distributes them to the retailer, which will be sold by the traditional distribution channel. There is a competition between the Internet channel and the traditional distribution channel.This paper sets up bi-level programming models for the product pricing problem in dual-channel supply chains based on linear demand function from two aspects, one of which is that the manufacturer is the leading company and the other one is that the retailer is the leading one, and at last takes examples to validate the models.