The study on price and lead time decisions in retailer-dominated dual-channel supply chain

Abstract

Retailers are the dominant firm in the dual-channel supply chain composed of manufacturers and retailers. Based on the assumption of linear correlations between price and quoted delivery lead time decision and market demands, a typical dual-channel supply chain model is constructed, and the following conclusions are derived. (1) Under different-price strategies, retailers’ online/offline channel optimal prices show linear relations with lead time and there are criticality conditions in positive/negative correlation changes. (2) Under same-price strategies, an analytic expression of end customer demanded quoted delivery lead time in the dual-channel supply chain system is proposed, and the value is uniquely confirmed by system parameters. (3) Manufacturer profits are the dependent decision variable in the retailer-dominated dual-channel supply chain system, but manufacturer profits are not affected by retailer decisions when online channel and offline channel reveal consistent quoted delivery lead time preference.