Research on manufacturer's dual-channel pricing strategy based on power structure
by Weihua Liu; Wenfei Wu; Xiaoyu Yan; Xinyun Liu
International Journal of Modelling in Operations Management (IJMOM), Vol. 8, No. 4, 2022

Abstract: This paper constructs four models: 1) manufacturer-led + discriminatory pricing; 2) manufacturer-led + unified pricing; 3) retailer-led + discriminatory pricing; 4) retailer-led + unified pricing. By constructing the Stackelberg game model under different power structures, we find that when the manufacturer is dominant in the dual-channel supply chain and the retailer's lowest profit margin is in the middle, the manufacturer chooses to discriminate pricing. When the lowest profit margin of retailers is large, manufacturers always choose uniform pricing. When retailers are in a dominant position in the dual-channel supply chain and the highest profit margin of retailers is large, retailers will give priority to the unified pricing strategy; otherwise, retailers will choose the discriminatory pricing strategy.

Online publication date: Wed, 03-May-2023

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