Decision-Making of Electronic Commerce Supply Chain considering EW Service

Yuyan Wang,Liang Shen,Runjie Fan,Zhaoqing Yu

doi:10.1155/2020/8035045

Abstract

With the rapid development of the network economy, it is a marketing strategy to provide an extended warranty (EW) service. Considering the differences in the EW service providers and dominant enterprises, this paper proposes four kinds of decision-making models and aims to study decisions of the electronic commerce supply chain, including EW price, sales price, and service level of e-platform. Through comparative analysis and numerical analysis, this research shows that, among four decision-making models, the highest system profit can be achieved when the seller provides the EW service and the e-platform dominates the system. For electronic commerce supply chain enterprises, whether to dominate the system or to provide EW service, it is conducive to the increase of profits. When the e-platform provides the EW service, the conclusion is that who dominates the system is the one who gets more profit. However, when the seller provides the EW service, the conclusion is that who dominates the system is the one who gets less profit. When the EW service is offered by the dominating enterprise, service levels of the e-platform are lower.

Highlights

With the development of the network economy, the electronic commerce supply chain (ECSC) has been greatly promoted and advanced. e ECSC focuses on core enterprises, integrates upstream and downstream resources, makes full use of the network technology, and achieves all-win results for supply chain participants [1, 2]
Is paper aims to address the following problems: what are the optimal decisions of the ECSC system when considering the extended warranty (EW) service and the sales service of the e-platform; what is the influence of power structure and different EW service providers on the optimal decisions; what is the comparative relationship of optimal decisions in different decision models; how do enterprises provide the EW service, and whether should they provide the EW service when they dominate ECSC? With these problems in mind, the conclusions intend to provide the managerial insights for the operation of enterprises in the ECSC
The e-platform’s profit is the highest when the e-platform provides the EW service and dominates the supply chain at the same time, but the seller’s profit is the lowest. erefore, when e-platform provides EW in an ECSC, it is profitable for supply chain members to obtain the dominant power

Summary

Introduction

With the development of the network economy, the electronic commerce supply chain (ECSC) has been greatly promoted and advanced. e ECSC focuses on core enterprises, integrates upstream and downstream resources, makes full use of the network technology, and achieves all-win results for supply chain participants [1, 2]. In the ECSC, the seller directly sells products to consumers with the aid of the e-platform, which is a direct-sale model [8]. Considering research gaps, four decision models are constructed and analyzed taking into account the differences in the power structure and EW providers in the ECSC. Is paper aims to address the following problems: what are the optimal decisions of the ECSC system when considering the EW service and the sales service of the e-platform; what is the influence of power structure and different EW service providers on the optimal decisions; what is the comparative relationship of optimal decisions in different decision models; how do enterprises provide the EW service, and whether should they provide the EW service when they dominate ECSC?

Literature Review

Model Formulation and Equilibrium Solution

Discussion

Proof of Proposition 3