 Two-period pricing and quick response with strategic customersJunfeng Dong and Desheng Dash Wu International Journal of Production Economics, 2019, vol. 215, issue C, 165-173 Abstract: This research examines the impact of the strategic customer behavior in two-period pricing and the inventory decisions in a quick response system. A model with a differentiated value period of product is developed when customers are strategic and heterogeneous. Interestingly, the unique equilibrium is proven to exist if and only if the degree of customer strategic behavior is sufficiently high. Otherwise, the dynamic pricing strategy in one selling season is not a suitable choice for a firm. Moreover, the impact of strategic consumers on pricing and inventory strategies is investigated in the case where the clientele's taste for product value follows a uniform distribution. Surprisingly, contrary to previous studies, we found that strategic consumers may yield more revenues in specific scenarios. An extended analysis on Beta distribution is also presented, showing that there is greater chance to obtain the highest profit in the supply chain when all customers are strategic and if more people prefer low-value products. Keywords: Strategic customer; Quick response; Game theory; Inventory and dynamic pricing decisions (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:215:y:2019:i:c:p:165-173 DOI: 10.1016/j.ijpe.2017.06.007 Access Statistics for this article International Journal of Production Economics is currently edited by Stefan Minner More articles in International Journal of Production Economics from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.