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2017 | OriginalPaper | Chapter

Competition in a Two-Channel Supply Chain with Symmetric Retailers Under Channel Preference

Authors : Jinjin Liu, Hua Ke

Published in: Proceedings of the Fourth International Forum on Decision Sciences

Publisher: Springer Singapore

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Abstract

In this paper, we study competition in a two-channel supply chain where a supplier sells a single product to multiple symmetric retailers as well as to end customers directly. A linear inverse demand function with channel preference is proposed to study the effect of channel preference on profit and efficiency. Then we study analytically the supply chain in decentralized and centralized cases and give closed-form expressions for both equilibriums. It is proved that the profit of the supplier decreases first and then increases with the augment of the degree of customer preference to the direct channel, and when the degree of customer preference to the direct channel is greater than some value, the retailer’s profit increases with its augment. In addition, we consider the difference in profits with and without channel preference and show that the channel preference has positive effects on profit provided that it is less than some value. Moreover, the efficiency of supply chain can be improved by incorporating channel preference and increasing the number of retailers.

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previous chapter Pricing Decision Problem in Closed-Loop Supply Chain Under Uncertain Random Environment
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Metadata
Title
Competition in a Two-Channel Supply Chain with Symmetric Retailers Under Channel Preference
Authors
Jinjin Liu
Hua Ke
Copyright Year
2017
Publisher
Springer Singapore
Book
Proceedings of the Fourth International Forum on Decision Sciences

Print ISBN: 978-981-10-2919-6

Electronic ISBN: 978-981-10-2920-2

Copyright Year: 2017

DOI
https://doi.org/10.1007/978-981-10-2920-2_47