Research On3C Manufactures’ Stock-out Compensation Policy With Price Continuous Reduction

Because of increasingly fierce competition and technology progress in recent years, the3C products renewal faster and faster, the lifecycle is also shorter. Along with the3C product upgrading its price also presents a declining trend. In order to seize the declining chance to reduce the purchasing cost, the companies often adopt the small lots&multi-frequency policy. As the demand is incertitude, stock-out is inevitable, which leads to the profit lost and furthermore, the loss of market shares.This paper Propose that we should pay more attention to the influence of shortage to the enterprise and consider introducing stock-out compensation policy into the purchasing decision, which means offer certain discounts to consumer after the arrival of the goods when stock-out. We established a model to determine the purchase time and purchase quantity of each point, and use example analysis combining with the reality to analyze the influence of profits and losses when implementing stock-out compensation strategy and without stock-out compensation policy.This paper contains two parts. In the first part, we introduced stock-out compensation strategy and analyzed the purchasing policy on the basis of uncertain demand, with price continuous reduction. In the second part, we use calculation analysis comprised the result between stock-out compensation and without stock-out compensation. The results show that the implementation of stock-out compensation will bring much more profit in case of price continuous reduction. It also puts forward some corresponding Suggestions to customer compensation strategy for3C manufacturers.