Abstract
With the advancement of technologies, industries tries to adopt the advantages of the technology. Customers are busy in their daily life, and the online platform is the best option for retail, whereas traditional customers still prefer to visit the retail shop. Few customers choose the product online but buy it offline or vice-versa. Owing to all those circumstances, current study focuses on an intelligent dual channel (online-to-offline) strategy in industry to arrange the optimal services for customers. The selling price of the product vary with different channel, which helps to determine the demand of product for entire supply chain. Two important factors, backorder and lead-time are examined precisely through marginal value which helps to arrange optimal service and calculate the exact profit. The profit for a centralized and decentralized case are computed for both the players. Some propositions are developed to prove the global optimality. Numerical results prove that a centralized case provides 7.77% better profit than a decentralized case due to bonding between the players.
Highlights
In those days, due to implementation of information technology and uses of different smart delivery policy, world was witness of huge changes in supply chain industry
Parameter related to online price Fixed transportation cost ($/shipment) Development cost of technology for O2O channeling ($/ unit) Price elasticity parameter for offline price Cost related to unit production of manufacturer ($/unit) Parameter related to offline sell ($/investment) Mean lead time demand Cost related to initial order ($/order) Reorder point for the retailer Fixed investment related to technology development ($/cycle) Cost for design web page for O2O installation ($/unit) Variance of the lead time Cost related to web page visualization ($/unit) Backorder cost ($/unit) Manufacturer’s fixed carbon emission cost ($/shipment) Manufacturer’s variable carbon emission cost ($/unit) Cost related to variable transportation ($/unit) Cumulative distribution function Number of quantity for expected backorder Expected on-hand inventory
Following hypotheses are made to construct this O2O supply chain management (SCM): (1) A savvy O2O retailing is created for a particular item, where a particular producer and individual-retailer are the players of the SC
Summary
Due to implementation of information technology and uses of different smart delivery policy, world was witness of huge changes in supply chain industry. Exact lead time and backorder are calculated through marginal value, which helps to obtain exact cost or profit of the system along with some continuous investments which directly reduce the ordering cost for the retailer and increase the reliability of the production process for the manufacturer under uncertain environment. This is the first try where all those research gap was full filled along with optimized system profit for the advanced dual channel system. Limitations and concluding remarks with some future extensions are described in the Conclusion Section 8
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