The pricing strategies in a new luxury goods manufacturer dominated supply chain

In the consumer market, new luxury brands (e.g. Emporio Armani, G-star, MiuMiu, Adidas Originals) usually act as the trendsetters and original designers, while some ordinary consumer goods´ brands (e.g. H&M, ZARA, Xstep, MetersBonwe) prefer to be followers. A new luxury goods manufacturer is also in a dominant place, when facing the supplier (as well as the outsourcer). Whereas, the situation is different for the Ordinary consumer goods manufacturer. This article studys the pricing strategies of three participants in a new luxury goods manufacturer dominated supply chain and some influence factors, basing on Cournot model and stackelberg model. After calculation and comparison, we analysed the corresponding strategies manufacturers and the supplier should adopt, when market size, brand value and product cost are changing, under given settings. And generally, we find that manufacturers benefit more in stackelberg game than in Cournot game, while the supplier gets more profit in Cournot game.