An option-pricing look at the introduction of private labels

I Horowitz
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I Horowitz: University of Florida and City University of Hong Kong

Journal of the Operational Research Society, 2000, vol. 51, issue 2, 221-230

Abstract: Abstract This paper uses an option-pricing model to explore the impact of various factors on whether and when a retailer will choose to introduce a private label in a product category that is currently the exclusive domain of a manufacturer. Among the factors considered are the retailer's and manufacturer's margins, the cost of introducing the private label, the shelf space to be devoted to the private label and by consequence the store-market share to be captured by it, and the quality of the private label.

Keywords: private labels; option pricing; decision analysis (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (15)

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DOI: 10.1057/palgrave.jors.2600847

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