Abstract
With increasing market competition and rapid development of service economy, more and more enterprises are shifting from providing products or services to providing product-service systems (PSSs) that integrate products and services, in order to improve competitiveness and profitability. Meanwhile, consumers have strategic delayed purchasing behavior when purchasing the PSS and high requirements for service quality. This paper investigates the two-period pricing and service quality decisions of product-service supply chain (PSSC) considering consumers’ strategic behavior under decentralized and centralized scenarios. The equilibrium results are compared in two scenarios. In order to eliminate performance loss under the decentralized scenario, we design two-period dynamic contracts to coordinate the PSSC. Furthermore, numerical simulation is provided to verify the feasibility of the contracts. The following conclusions can be drawn: (1) the higher the service input-efficiency, the more beneficial for alleviating consumers’ strategic purchase behavior under two scenarios, but this mitigation effect is more obvious under the centralized scenario. (2) Compared with the centralized scenario, the service quality is lower, the two-period PSS sales prices are higher, and the two-period profit is lower under the decentralized scenario. The proportion of service valuation (accounts for the valuation of PSS) will promote the widening of the service quality gap under two scenarios, but in some cases, the service input-efficiency will weaken the promotion effect of the proportion of service valuation. (3) The design of the two-period combined contracts depends on the proportion of service valuation. When the proportion of service valuation is high, the “two-period revenue sharing + service-cost sharing” combined dynamic contract can achieve PSSC perfect coordination. However, when the proportion of service valuation is low, it is necessary to design complexity combined dynamic contract which can achieve PSSC perfect coordination.
Highlights
In the face of fierce market competition and the product lifecycle which is constantly shortened, dynamic price reduction strategy has become an effective way for firms to respond to competition and increase sales
(2) Compared with the centralized scenario, the service quality is lower, the two-period product-service system (PSS) sales prices are higher, and the two-period profit is lower under the decentralized scenario. e proportion of service valuation will promote the widening of the service quality gap under two scenarios, but in some cases, the service inputefficiency will weaken the promotion effect of the proportion of service valuation. (3) e design of the two-period combined contracts depends on the proportion of service valuation
E above literature studies consider the impact of consumers’ strategic behavior on product pricing decisions from an enterprise perspective or supply chain perspective and do not consider the impact of service. is paper will extend to the product-service supply chain (PSSC), construct multiperiod dynamic decision models including consumers’ strategic behavior and service, analyzing and comparing dynamic equilibrium results and supply chain profits in two different scenarios, and design dynamic contracts to eliminate performance loss of the decentralized supply chain
Summary
In the face of fierce market competition and the product lifecycle which is constantly shortened, dynamic price reduction strategy has become an effective way for firms to respond to competition and increase sales. Is paper will extend to the PSSC, construct multiperiod dynamic decision models including consumers’ strategic behavior and service, analyzing and comparing dynamic equilibrium results and supply chain profits in two different scenarios, and design dynamic contracts to eliminate performance loss of the decentralized supply chain. Another type of literature related to this paper is research on PSS and PSSC, which mainly includes qualitative analysis and quantitative analysis. Erefore, it is necessary to consider consumers’ strategic behavior in the relevant research of PSSC
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