Abstract
The express service quality becomes a dominant factor along with the price of product affecting consumer's purchasing decision. This paper investigates how the express service quality affects the demand of online purchasing, and how to improve the express service quality and supply chain's performance through cooperation. The authors consider an online supply chain and utilize a nonlinear demand model by incorporating the express service quality as a decision variable and propose four express service cooperation modes, i.e. (1) the retailer offering subsidy to the express provider, (2) the integration between the retailer and the express provider, (3) the manufacturer offering subsidy to the express provider and (4) the integration between the manufacturer and the express provider. In each cooperation mode, they derive the equilibrium pricings, service levels, demands and profits. By comparison, the authors explore which one is appropriate for chain members to implement.
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