Search

Production disruptions in supply chain systems affect all supply chain members and lead to problems such as the ripple effect. As observed from practice that the production disruption, which is caused by labor strike, natural disaster or equipment breakdown, occurs frequently and the manufacturer has to consider this seriously so as to control the risk. In this paper, we study the problem by examining the impacts on the consumer, supply chain agents and society brought by production disruptions. We explore the different parameters influences on the optimal decisions of retail price and the profit of supply chain agents as well as the profit variance. We also further extend the model by making wholesale price or penalty fee fixed, and find that the profit will not be affectted by both of wholesale price and penalty fee. However, the wholesale price (penalty fee) will affect the profit variance of the supply chain agents. The findings imply that for risk neutral supply chain agents, wholesale price (penalty fee) is not the core factor for them, but it is crucial for the risk averse or risk seeking supply chain agents. We think this paper fills the gap by examining the profit risk in a supply chain facing production disruptions and also the impacts on consumer surplus and society. [ABSTRACT FROM AUTHOR]

The diversion of manufacturers' branded products outside the authorized channel leads to the emergence of gray markets (GMs), which is legal under the doctrine of first sale. Product diversion to GMs can negatively affect manufacturers' brand reputation. In this study, we analyze a manufacturer's strategic channel choice decision and its implications for social welfare in the presence of GMs and strategic consumers. We present scenarios in which the presence of GMs can either have a positive or negative impact on the manufacturer and the supply chain. Our findings indicate that the manufacturer and the supply chain become worse off due to product diversion to GMs under lower channel differentiation and high penalty cost for the loss of brand reputation due to product diversion. This effect is more severe for a decentralized supply chain, where product diversion does not directly affect the retailer's profitability due to the erosion of brand reputation. In such scenarios, we suggest that manufacturers should follow a brand-protection strategy to curb product diversion to GMs. However, manufacturers selling product categories with low brand equity can follow a market-expansion strategy. In such cases, the presence of GMs provides an alternative channel to expand sales by capturing untapped consumer segments without incurring additional market search or advertising costs. This strategy also facilitates indirect price discrimination among consumers. We find that social welfare is higher when channel differentiation is low under a decentralized supply chain. [ABSTRACT FROM AUTHOR]

In recent years, online reviews are increasingly getting more concerns by firms and consumers because they can help mitigate consumers' uncertainty on product quality and experienced attributes and significantly affect firms' operational decisions. We in this study attempt to examine the remanufacturing entry and pricing strategies of manufacturers in the presence of online reviews. We consider an original equipment manufacturer (OEM) selling a new product over two periods in online retailing and determine whether and when to adopt a remanufacturing entry strategy in the market. We uncover online reviews' quality-dimensional effect and experienced dimensional effect that jointly determine the OEM's pricing and remanufacturing strategies. We show that in the presence of online reviews, the OEM will cautiously determine whether to adopt the first-period remanufacturing entry strategy and may also adopt the second-period remanufacturing entry strategy under certain conditions. Interestingly, the OEM will adopt the penetration pricing strategy for the new product and the remanufactured product (if available) when the actual product quality is sufficiently high, but the skimming pricing strategy otherwise, which is different from the uniform pricing strategy in the absence of online reviews. Our results also show that online reviews significantly affect the OEM's profit and consumer surplus. In particular, when the actual product quality is high enough, the OEM and consumers will attain the "win–win" situation. [ABSTRACT FROM AUTHOR]

In much of today's competitive marketplace, consumers have the opportunity to choose where they spend their money based on their examination of a company's corporate social responsibility. A company's social reputation and its promotional efforts may influence consumer choice. Sustainable development is highly regarded by governments, experts, decision-makers and managers in organizations and two-level supply chains. This supply chain includes a manufacturer (acting as leader) and a retailer (acting as follower), both of whom face demand uncertainty. In this article, the cost of advertising is considered in two ways for the manufacturer and the retailer. In the first model, the retailer determines the optimal retail price and order quantity, and the manufacturer determines the optimal wholesale price and the promotional efforts value so that their profits are maximized. In the second model, the retailer determines the optimal retail price, order quantity, and promotional efforts value, and the manufacturer determines the optimal wholesale price. We will also study the impact of promotional cost sharing on the coordination of the supply chain and the issue will be further explained with numerical examples. Therefore, in this research, the simultaneous effect of increased advertising and value consumer surplus is studied We examine cases when the retailer is a provider of promotional cost and profit, when consumer surplus is directed toward the retailer, and when both retailer and manufacturer achieve higher profits than when the manufacturer is responsible for promotional cost and profit. [ABSTRACT FROM AUTHOR]