Coordination mechanism of logistic service supply chain: a perspective of presale sinking and risk aversion. (18th January 2023)

• Record Type: Journal Article
• Authors: Liu, Weihua; Wei, Shuang; Shen, Xinran; Liang, Yanjie
• Is Part Of: European journal of industrial engineering. Volume 17:Number 2(2023)
• Page Start: 310
• Page End: 341
• Publication Date: 2023-01-18
• Subjects: presale sinking -- risk aversion -- logistics pre-distribution -- conditional value-at-risk -- CVaR; Industrial engineering -- Europe -- Periodicals; 658.50094
• Languages: English
• ISSNs: 1751-5254

Abstract

Many retailers are implementing presale strategies with logistics integrator for presale sinking, and pre-distributing products to sinking sites in advance, to conveniently and efficiently deliver to customers. This paper explores the influence of presale strategies and risk-averse behaviour on decisions and profits of the logistics integrator in the context of demand updating. The paper finds that when retailer adopts presale strategies with a larger discount, all potential customers will pre-order in the first period; otherwise, all potential customers will buy in the second period. These presale strategies can increase the pre-distribution volume and utility of the logistics integrator. While the risk-averse behaviour leads to a decrease in the pre-delivery volume, the utility of logistics integrator increases. Under these presale strategies, high discounts can eliminate the impact of uncertain demand risk, while presale strategies with low discounts cannot. [Submitted: 24 October 2021; Accepted: 3 February 2022]