Optimal Dynamic Decisions For Assembly Products Supply Chain Considering Components Update

Based on the original product,addding or optimizing some functionsis Update product.Update product having more advanced technology,more powerful features,is more able to get the favor of consumers.Product upgrading is becoming intensivein various industries,especially in the IT industry.Most of products are assembly products,whose components updating led to the overall product updating.How to optimize the dynamic pricing decision for the assembly products supply chain based on the components update will greatly affect the survival and development of the enterprise.The dynamic pricing decision problem of the supply chain entity is studied in this paper.Firstly,the relationship between the original and updated products is introduced in this paper,as well as the composition and structure of update assembly products.The model of new and oroginal assembly products supply chain is established based on key components updating.The supply chain consists of the old and new key components suppliers and product assemblers.Secondly,the dynamic demand function model of old and new products is established by combining the static difference product demand model and the Fisher diffusion model.The potential market demand of new products in the dynamic demand model with time followan S-shaped curve.When the time is constant,the potential market share of the old and new products is constant.And the demand for the two generations of products is inversely proportional to the price of the product and the price of the competing product.Based on the above supply chain model and dynamic demand function model,the optimal dynamic pricing decisions and profits of all entities in the supply chain were acquired using Stackelberggame when two assemblers are non-cooperative.Some insights have been derived through theoretical analysis and simulation: Both the dynamic wholesale and retail price curves are decreasing with the renewal of the product lifecycle while the dynamic wholesale and retail price curves are rising,and the the rising amplitude is equal to those of the corresponding original product price In addition,the higher the innovation factor,the greater the decline or rise.Finally,in the case of two assemblersare cooperation,the Stackelberg game between the suppliers and the assembler is studieds.The simulation results show that the wholesale price of the key components is larger than that of the no cooperative situation,and on the contrary,the increase or decrease of the retail price is less than that of the non cooperative case.The manufacturers' revenue are greater than those of the corresponding suppliers.The suppliers' profits in the case of cooperativeare lower than those in the case of non cooperative,and the profits of the assemblers is greater than those in the case of non cooperative.The closer the market price sensitivity and the function substitution parameter are,the higher the products demand,the wholesale prices,the retail prices,and the profts of two suppliers and two assemblers will be.