Strategy Analysis of Selling Model Selection in Vertical Competition Supply Chains: A Game Theoretic Model. (20th September 2021)

• Record Type: Journal Article
• Authors: Chen, Qian; Liu, Sen; Wang, Lijun; Zhang, Zhe; He, Xiaojun
• Other Names: Martín-Herrán Guiomar Academic Editor.
• Is Part Of: Mathematical problems in engineering. Volume 2021(2021)
• Publication Date: 2021-09-20
• Subjects: Engineering mathematics -- Periodicals; 510.2462
• DOI: 10.1155/2021/3140493
• Languages: English
• ISSNs: 1024-123X

Abstract

Abstract : This paper takes the supply chain perspective to study the choice of selling model for manufacturers and e-tailers. To accomplish our objective, we consider three selling models, including reselling, agency selling, and mixed selling. By comparing and analyzing the equilibrium outcomes of the three selling models, we obtain some beneficial results. These results show that manufacturers and e-tailers cannot manage to make a profit at the same time whether they choose the reselling model or agency selling model. Our results also show that the mixed selling model may improve supply chain performance, as long as the cross-price elasticity is not low. Especially when the cross-price elasticity is comparatively high, a manufacturer and an e-tailer in vertical competition can achieve a profit-Pareto-improving situation, regardless of the market share of the e-tailer.