Equilibrium Decisions for Fresh Product Supply Chain Considering Consumers’ Freshness Preference

Xue Chen (), Jun Li () and Zhongbao Wang ()
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Xue Chen: Southwest Jiaotong University
Jun Li: Southwest Jiaotong University
Zhongbao Wang: Southwest Jiaotong University

Networks and Spatial Economics, 2023, vol. 23, issue 3, No 10, 797 pages

Abstract: Abstract Consumers’ requirements regarding the level of freshness of certain perishable products have increased alongside continuous improvement in people’s living standards. Thus, a growing number of retailers are taking freshness-keeping measures to satisfy consumers’ demands. This study introduces an online-to-offline (O2O) dual-channel supply chain optimization model considering consumers’ freshness preference. The model contains multiple suppliers, retailers and demand markets. The retailers purchase the products from suppliers through offline channels and sell the products to consumers via offline and online channels. On this basis, we describe the optimization model as a variational inequality problem and use an effective convergence algorithm to approximate the equilibrium solution of the supply chain. The computational results show that suppliers are always profitable from retailers’ freshness-keeping effort, regardless of whether consumers’ freshness preference is high or low. If more retailers invest in freshness-keeping effort, suppliers will obtain more profits. Furthermore, it is not always beneficial for retailers to engage in the freshness-keeping effort. They should take flexible freshness preservation measures on their products based on consumers’ freshness preference. Moreover, an increase in consumers’ freshness preference will incentive retailers to adopt more advanced freshness preservation technology to gain higher revenues.

Keywords: Dual-channel; Fresh product; Consumers’ freshness preference; Freshness-keeping effort; Variational inequality (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s11067-023-09590-3

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