Abstract

Taking the dual-channel supply chain embedded by two-echelon logistics service providers as the research object, this paper studies the optimal decisions of each decision maker under the centralized and decentralized decision-making mode led by the retailer. Based on the decentralized decision-making mode, an improved coordination mechanism of residual profit sharing is designed to realize the interest coordination, in which the bargaining power of all participants is fully considered. The results show that, under the decentralized decision-making mode, the profit of FLSP increases first and then decreases as the sensitivity coefficient of cross-service level increases, while the profits of other decision makers and the supply chain system decrease with the increase of sensitivity coefficient of cross-service level. The relative size of the price sensitivity coefficient of online and offline channel has an inconsistent impact on the profit of FLSP, while it has a consistent impact on the profits of other decision makers. The profit of FLSP fluctuates greatly with changes in the sensitivity coefficient, and it is difficult to be guaranteed in the entire supply chain system. On this basis, an improved coordination mechanism of residual profit sharing is designed. The results show that, after the introduction of bargaining power coefficient of the Nash negotiation model, the variation coefficient of the profits of all decision makers is smaller after coordination, and the profit growth rates are more uniform.

Highlights

  • At present, with the rapid development of mobile Internet and e-commerce, consumers’ preference for online shopping is gradually increasing, and online retail industry is advancing by leaps and bounds. e Chinese Electronic Commercial Research Centre reported that the transaction scale of China’s online retail market has increased from 0.27 trillion yuan in 2009 to 10.32 trillion yuan in 2019, with an average annual growth of 43.96% In view of the advantages of online retail channel, such as wide coverage of customers, low operating costs, and realtime continuous interaction with consumers, some retail enterprises give priority to opening up online channel to sell products, such as Netease Strict Selection Company, Xiaomi Co., Ltd, and ree Squirrels Co., Ltd

  • There is an urgent need for Logistics Service Integrator (LSI) with strong resource integration capabilities to better meet the logistics demand of retailers’ online channel through integrating Functional Logistics Service Provider (FLSP). erefore, a supply chain system embedded by twoechelon logistics service providers is formed

  • As far as the author concerned, this is the first paper that studies the dual-channel supply chain system embedded by two-echelon logistics service providers, discussing the optimal decisions and interest coordination mechanism and exploring the effect of sensitivity coefficient of product retail price for online and offline channels on the optimal decisions and profits of each decision maker

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Summary

Introduction

With the rapid development of mobile Internet and e-commerce, consumers’ preference for online shopping is gradually increasing, and online retail industry is advancing by leaps and bounds. e Chinese Electronic Commercial Research Centre reported that the transaction scale of China’s online retail market has increased from 0.27 trillion yuan in 2009 to 10.32 trillion yuan in 2019, with an average annual growth of 43.96% (http://www.100EC.CN.) In view of the advantages of online retail channel, such as wide coverage of customers, low operating costs, and realtime continuous interaction with consumers, some retail enterprises give priority to opening up online channel to sell products, such as Netease Strict Selection Company (an online retailer, abbreviated as “Netease”), Xiaomi Co., Ltd (http://www.mi.com), and ree Squirrels Co., Ltd. In today’s consumer upgrading market environment, consumers pay attention to products and prices and value the integrated shopping experience throughout the consumption process, which will prompt more online retailers to actively open offline channels At this time, the single-channel supply chain embedded by two-echelon logistics service providers has evolved into a dual-channel supply chain. As far as the author concerned, this is the first paper that studies the dual-channel supply chain system embedded by two-echelon logistics service providers, discussing the optimal decisions and interest coordination mechanism and exploring the effect of sensitivity coefficient of product retail price for online and offline channels on the optimal decisions and profits of each decision maker.

Literature Review
Conceptual Model and Research Assumptions
Decentralized Decision-Making Mode
Findings
Improved Residual Profit-Sharing Coordination Mechanism
Full Text
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