Distributor´s pricing policy with channel competition

Author

Ding, Yichao ; Chen, Xu

Author_Institution

Sch. of Manage. & Econ., Univ. of Electron. Sci. & Technol. of China, Chengdu, China

fYear

2011

fDate

25-27 June 2011

Firstpage

1

Lastpage

4

Abstract

In this paper, we study a distributor´s pricing policy with channel competition. Assuming a three-echelon supply chain includes a manufacturer, a distributor and a number of retailers, among which there is a dominant retailer in the region who has a larger market share. We model these issues with game theory, and find: (1) the dominant retailer has a unique optimal order policy; and that (2) the distributor has a unique optimal distributor pricing policy; and that (3) under certain conditions, the distributor can get more revenue when his distribution price is lower than the manufacturer´s direct sale price; as for the dominant retailer, ordering from distributor can get a lower price and a higher profit compare to ordering directly from the manufacturer.

Keywords

game theory; pricing; supply chains; channel competition; dominant retailer; game theory; manufacturer direct sale price; market share; optimal distributor pricing policy; three-echelon supply chain; Economics; Fluctuations; Marketing and sales; Pricing; Procurement; Sensitivity; Supply chains; channel competition; order policy; pricing policy; three-echelon supply chain;

fLanguage

English

Publisher

ieee

Conference_Titel

Service Systems and Service Management (ICSSSM), 2011 8th International Conference on

Conference_Location

Tianjin

ISSN

2161-1890

Print_ISBN

978-1-61284-310-0

Type

conf

DOI

10.1109/ICSSSM.2011.5959474

Filename

5959474