Price squeeze under fairness: the road to supply chain coordination with a powerful retailer

Mengmeng Wang and Xiaojing Feng

Journal of Management Analytics, 2022, vol. 9, issue 4, 448-479

Abstract: This research investigates the impacts of the manufacturer’s fairness concerns on the supply chain performance when the power retailer implements a price squeeze and market service investment together. Through game-theoretic modeling, we find that 1) in the absence of fairness, although the manufacturer may be worse off due to possessing imperfect information on the price squeeze rate, the channel may be coordinated through an ex-ante negotiation between the two parties. 2) When the manufacturer has fairness concerns for price squeeze, both channel performance and brand goodwill are made worse by disadvantageous inequality and improved by advantageous inequality versus the case of no fairness concerns. Furthermore, channel members’ ex-ante negotiations regarding a profit reallocation scheme under certain conditions may achieve the following three objectives: generating a channel profit of the coordination level, promoting brand goodwill to the level of the integrated channel, and creating an equitable channel relationship.

Date: 2022
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hdl.handle.net/10.1080/23270012.2022.2089063 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:tjmaxx:v:9:y:2022:i:4:p:448-479

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/tjma20

DOI: 10.1080/23270012.2022.2089063

Access Statistics for this article

Journal of Management Analytics is currently edited by Li Xu

More articles in Journal of Management Analytics from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().