Abstract
This article explores a supply chain model consisting of a single manufacturer and two competing retailers. The manufacturer, as a Stackelberg leader specifies a wholesale price and bears servicing costs of the products. Then, both the retailers advertise the products and sell them to the customers. So, the demand of the products is influenced by selling price, service level and also promotional effort. On the basis of this gaming structure, two mathematical models have been formed - crisp model, where each member of the chain exactly knows all the cost parameters and fuzzy model where those cost parameters are considered as fuzzy numbers. Optimal strategies for the manufacturer and the retailers are determined and some numerical examples have been given. Finally, how perturbations of parameters affect the profits of the chain members have been determined.
Highlights
Consumers buy products on the basis of quality, cost, range of products, availability, after-sale service [12]
The demand function was considered as a function of only price and service level
This paper explored the equilibrium decisions of the chain members
Summary
Consumers buy products on the basis of quality, cost, range of products, availability, after-sale service [12]. Two-Echelon Supply Chain Model with Demand Dependent On Price, Promotional Effort and Service Level in Crisp and Fuzzy Environments 317. Pal et al considered a two-echelon supply chain model where there were one manufacturer and one retailer with customer demand dependent on price, promotional effort and product quality. Tsay and Agrawal explored a supply chain model with two competitive retailers and one manufacturer in which both the retailers offered products as well as service to customers. He et al explored coordination in a two-level supply chain with one manufacturer and two competing retailers under advertising dependent demand. This paper considers demand to be a function of selling price, promotional effort and the service level. Notations (a) ci : production cost for the ith product (b) fi: manufacturer’s wholesale price for the ith product (c) gi: manufacturer’s service level for the ith product (d) ei : the selling price of the ith retailer (e) hi : ith retailer’s promotional effort (f) πri : profit of the ith retailer (g) πm :profit of the manufacturer where i =1,2 and ith retailer sells the ith product
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: Pakistan Journal of Statistics and Operation Research
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
