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Pricing and financing strategies of a dual-channel supply chain with a capital-constrained manufacturer

Author

Listed:
  • Jiasen Sun

    (Soochow University)

  • Pengpeng Yuan

    (Soochow University)

  • Lianlian Hua

    (Inner Mongolia University of Technology)

Abstract

This study explores the operation decisions of a dual-channel supply chain consisting of a capital-constrained manufacturer, an e-commerce platform (ECP), and a third-party logistics company (3PL). This study first proposes two game models to obtain the equilibrium solutions of the supply chain members. Then, it compares and analyzes the equilibrium strategies under the two financing modes. This study has obtained the following interesting findings. The increase of the ECP interest rate will reduce the profit of the unit product in the distribution channel. However, the total income of the ECP will increase with the increase in the financing income. Under the 3PL financing mode, if the transportation fee of the direct sales channel is lower than that of the distribution channel, the ECP will reduce the sales price to compete with the direct sales channel of the manufacturer. Under the same conditions, the ECP financing mode is more competitive than the 3PL financing mode, and ECP financing services are the dominant strategy for the manufacturer, ECP, and consumers. If a 3PL company wants to win in the financing service, lowering interest rate or implementing differentiated transportation charges are important measures.

Suggested Citation

  • Jiasen Sun & Pengpeng Yuan & Lianlian Hua, 2023. "Pricing and financing strategies of a dual-channel supply chain with a capital-constrained manufacturer," Annals of Operations Research, Springer, vol. 329(1), pages 1241-1261, October.
    • Handle: RePEc:spr:annopr:v:329:y:2023:i:1:d:10.1007_s10479-022-04602-w
    DOI: 10.1007/s10479-022-04602-w
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