Direct Sales Channel Research Articles

Manufacturer encroachment in the presence of the store-brand

PurposeThis paper aims to identify the conditions under which encroachment is a viable strategy for a manufacturer to gain competitive advantage and achieve higher profitability in the presence of the store-brand.Design/methodology/approachThis paper proposes game-theoretic models in a two-echelon supply chain consisting of a manufacturer (him) and a retailer (her), in which he distributes his national brand through the retailer, and endogenously determines whether to establish a new direct sales channel to sell the national brand when the retailer introduces her store-brand.FindingsAnalytical results show that the bar for the manufacturer to encroach the end market in the presence of the store-brand is always higher than that for him to encroach in the absence of the store-brand. Although incurring channel competition, encroaching with the national brand in the presence of the retailer's store-brand can lead to either a win-lose or win-win result for the manufacturer and the retailer. Numerical studies claim that, higher brand substitution can push down the retailer's enthusiasm to introduce her new brand. Counterintuitively, when the retailer introduces her store-brand, higher brand substitution does not necessarily push up the manufacturer's enthusiasm to respond with national-brand encroachment. When consumer preferences for the two brands are heterogeneous, a higher consumer preference for the retailer's store-brand results in the retailer's higher enthusiasm to introduce her store-brand and the manufacturer's lower enthusiasm to encroach with his national brand.Originality/valueThis study can help researchers to better understand the retailer's store-brand introduction, manufacturer encroachment and their interaction theoretically, and further provide decision support for enterprises to choose brand and channel strategies in practice.

Manufacturer Channel Encroachment and Evolution in E-Platform Supply Chain: An Agent-Based Model

Manufacturer channel encroachment is a common phenomenon in the current e-commerce supply chain, which has been well studied. This study develops a multi-agent-based model of the e-platform supply chain to analyse manufacturers’ channel encroachment strategies and supply chain evolution. Through both direct sales channels and e-commerce platforms, manufacturers can sell two complementary products of varying quality. Consumers who have preferences compare the pricing information gathered from manufacturers through different channels before selecting the one that generates the best utility. At the end of each period, the manufacturers make a price adjustment using the genetic algorithm. We look at the supply chain evolution process through multi-period simulations and discuss the factors that influence encroachment decisions. We find that manufacturers’ channel encroachment is detrimental to the profitability of the e-commerce platform. Consumers’ channel preferences and quality preferences benefit the e-commerce platform and can discourage manufacturers’ encroachment decisions. In addition, increases in encroachment costs and commission rates can reduce manufacturers’ propensity for channel encroachment.

Channel structures of transnational supply chains

<p style='text-indent:20px;'>There are two fundamental and important problems for enterprises with an existing domestic supply chain: whether to build a new transnational supply chain and which channel should be chosen to build the new transnational supply chain. In this paper, we assume that the enterprise's existing domestic supply chain structure and the transnational supply chain structure to be considered are likely to be distributor channels and direct sales channels. By considering different channel scenarios at home and abroad, we establish a robust newsvendor model with profit maximization motivation to study the above-mentioned problems. We find that exchange rate risk and foreign price are key factors that determine whether an enterprise chooses to build a new transnational supply chain. However, the channel preference of enterprises when constructing transnational supply chains depends not only on exchange rate risk and foreign price, but also on the drive of foreign demand attributes (demand scale and demand uncertainty). We also find that enterprises have a humanitarian "principle of equality" when considering the construction of transnational supply chains <inline-formula><tex-math id="M1">\begin{document}$ - $\end{document}</tex-math></inline-formula> the operational characteristics and channel structure of domestic supply chains will not affect whether and how enterprises build a new transnational supply chain.</p>

Dual-channel supply chain coordination strategies considering electricity quality

<p style='text-indent:20px;'>The introduction of tradable electricity platforms in China has enriched the channels for consumers to purchase electricity and intensified the competition among channels. The quality of electricity is an essential factor affecting consumer purchasing behavior. This paper mainly focuses on the influence of the competition among channels on electricity quality.We construct a dual-channel electricity supply chain, in which electricity generators sell electricity directly to consumers or resell it through electricity retailers. We use the backward induction method of game theory to solve the equilibrium solutions in centralized, decentralized, and coordinated decisions. By analyzing and comparing the equilibrium solutions, we draw the following conclusions; (1) Electricity quality, electricity price, electricity demand, and profits increase with the sensitivity coefficient of electricity quality and price competition coefficient. (2) Electricity quality, electricity price, electricity demand, and profits decrease with the investment cost coefficient of quality improvement. (3) The increase in transmission and distribution costs reduces the electricity quality while increasing the electricity price through both channels. Furthermore, the increase leads to an increase in electricity demand and the profit of the electricity retailer through the resale channel. However, it reduces the electricity demand and the profit of the electricity generator through the direct sales channel. (4) A combined contract consisting of revenue sharing and quality improvement investment cost-sharing can lead to coordination.</p>

FACTORS DETERMINATING THE PERCEPTION OF AGRICULTURAL PRODUCTS

The research aimed to identify the factors most strongly determine consumers’ perception of agricultural products. The study was conducted using an online questionnaire made available on the most popular social networking site in Poland (Facebook) in groups of residents of the 16 voivodships of Poland. The survey verified the importance of the respondents’ beliefs about the modernity of agriculture, organic farming, and farmers’ presence in social media perception of agricultural products. Research has shown that in the perception of the quality of agricultural products, their ecological character, nutritional value, and availability of information on the course of the production process are of particular importance. The respondents’ interests in the system of production processes focused mainly on the welfare of farm animals and the impact of agricultural activity on the natural environment. Socially responsible, ecological agriculture, which is present in social media, was combined with modernity. The research also revealed the potential of social media as a direct sales channel for agricultural products. Respondents also found social media an effective marketing tool for agricultural products.

Pricing and manufacturing strategy of dual-channel green supply chain under common product competition

As consumers' green demand continues to rise, the competition between ordinary products and green products is becoming more and more intense. In order to study the impact of product competition and consumer green demand on product price and product greenness, as well as the optimal manufacturing strategy of dual-channel green supply chain, for a manufacturer and a retailer that can produce common products and green products, a set of The dual-channel supply chain composed of traditional retail channels and online direct sales channels, according to the different production modes of manufacturers, established a dual-channel supply chain game model of traditional production mode, green production mode and mixed production mode, and compared the products under the three production modes Price, greenness, and manufacturer's profit are verified with examples. The results show that: based on the consistent pricing strategy, consumer channel preference directly affects product price and greenness; product competition and consumer green demand sensitivity coefficients both promote product prices and product greenness; the manufacturer's optimal manufacturing strategy For the mixed production mode.

The impacts of blockchain adoption on a dual-channel supply chain with risk-averse members

Blockchain technology is believed to leverage the potential of supply chain performance. However, its benefits and related costs need to be balanced when implementing blockchain solutions. This study constructs a dual-channel supply chain where a manufacturer sells products through both the direct sales channel and the retail channel. Three blockchain adoption scenarios are considered in this study. We analytically find the blockchain adoption strategies of supply chain members are dependent on unit blockchain-operational cost, direct selling cost, and demand volatility. When blockchain adoption is cost-effective and demand volatility is small and medium, the adoption of blockchain solutions by both the manufacturer and the e-retailer (Model B) is more beneficial for the individual and the supply chain, but if demand volatility is large, it is more advantageous when only the e-retailer initiates blockchain solutions (Model R). When blockchain adoption is costly and demand volatility is medium and large, it is more valuable when only the manufacturer initiates blockchain solutions (Model D). We also conduct numerical experiments to inspect the impacts of an imperfectly competitive market and the variation of stakeholders’ risk-averse level on the model to present the robustness of our results. Based on these findings, we further provide theoretical and practical guidance for supply chain managers in determining the optimal blockchain adoption scenarios in a dual-channel supply chain.

Dual-channel supply chain coordination considering credit sales competition

Credit sales not only help sellers expand sale size and promote competitiveness, but also relieve the pressure of customers cash flow, but inevitably increases channel conflict and generates capital opportunity cost. This article attempts to consider a dual-channel supply chain operation decision and coordination under credit sales transactions for the first time, in which the supplier and the retailer compete on the credit period provided to the final customers, and the market demand is random and depends on credit period. This paper develops and analyzes the mathematical models of the dual-channel supply chain expected profit maximization under centralized, decentralized and coordinated decision making structures. A decision framework for a dual-channel supply chain considering credit sales competition and random demand is given, in which the supplier decides on wholesale price and online direct sales channel credit period, and the retailer decides on traditional retail channel credit period. This study finds that the fierce credit sales competition is bad for the dual-channel supply chain, and classical coordination contracts such as wholesale price joint trade credit contract have limitations in the dual-channel supply chain coordination considering credit sales competition. To stimulate channel members to make optimal decisions while optimizing their expected profits, a two-part credit contract based on asymmetric Nash bargaining is proposed. The research results reveal that the proposed contract can not only achieve the dual-channel supply chain coordination considering credit sales competition, but also achieve Pareto improvements of all members. Finally, the performance of different models is compared by numerical examples and sensitivity analyses, the effectiveness of the proposed contract is proved, and some managerial insights are given.

Punto de equilibrio productivo y márgenes de comercialización del productor de chile jalapeño (Capsicum annuum ‘alapeño’) en México

Farmers in Mexico are increasingly interested in higher-value alternatives to commodity production. The direct sales channel is a potentially attractive marketing alternative as it offers higher net income to farmers. However, in Mexico, few farmers use direct sales. The objective of this study, was to estimate the productive breakeven point and the marketing margins of the jalapeño pepper production in order to obtain profitability for the producers of this vegetable in Quintana Roo, Mexico. A sampling for finite populations was carried out, and the sample size was 89 producers. Results showed that a minimum of 10,754.5 kg.ha-1 is required with a rural sale price no less than 5.6 $.kg-1 of jalapeño pepper (equivalent to $0.20), to maintain a profitable and sustainable commercial supply of the crop. Producers sold most of their jalapeño production to wholesalers (58.4%), despite results showed the fact, that direct markets are the most profitable marketing channel for farmers of the area. The gross marketing margin was 74.5%, which indicated that, by each peso paid for jalapeño consumers, 74 cents corresponded to the intermediation process, and 25 cents to the producer. The organization of producers is crucial to increase the quality of the product and for a greater presence in the marketing chain.

Innovation features in the hotel industry: Croatian hotel websites

Abstract The hotel industry undeniably holds strong market power. Its economic impact can affect the infrastructural, economic, and digital development of a particular region. In addition to numerous advantages, digital development has also posed certain challenges for the hotel industry, such as fierce competition and a struggle for market power, which in turn lead to constant searching for new beneficial solutions. Hotel websites need to be of good quality to have a positive impact on profitability. Quality websites are functional and useful, and innovation is a common factor observed when testing quality. The aim of this paper is to provide an overview of the innovation activity of Croatian hotel websites. Two methods were used for research purposes: the e-MICA framework and content analysis. Descriptive statistics and the significance of Chi-squared tests were used to analyse the results. Research findings suggest that Croatian hotels have adopted innovative features on their websites modestly: mostly, 5-star hotels, hotel chains, and foreign-owned hotels as well as hotels focused strategically on direct sales channels. The obtained results are important for future research which should analyse the issue in more depth. Furthermore, hoteliers could also benefit from these results, and use them to their advantage in order to revise and improve their existing strategies.

Digital distribution of hospitality services in the context of the COVID-19 pandemic

The rapid implementation of digital technologies in all spheres of society resulted from the evolution of consumer needs and IT breakthroughs, the acceleration of which was caused by the COVID-19 pandemic. Lockdowns restricted physical contacts in customer service, highlighting the urgent need to digitize the business. The difficulties in predicting socio-economic conditions of the pandemic have led to new opportunities and mechanisms for the distribution of services and the formation of economic stress resilience of economic entities. The study aims to reveal the essence of the digital distribution of hospitality services in the conditions of uncertainty caused by COVID-19. The study of services digital distribution gives awareness of the possibilities of their implementation in the activities of hospitality entities, which were considered in the context of business security and development drivers during COVID-19. To achieve the study’s goal, a comprehensive approach to the essence of digital technologies, including those specific to hospitality entities, was used. The results of the analysis allowed stating the economic feasibility of direct sales channels. In addition, prerequisites for the collaboration of hospitality entities with digital channels were determined, recommendatory markers of optimal relations with distributors using digital innovations in business were formed. Further, business strategy development took into account the peculiarities of mixing the niches of competition of business entities in digital format and traditional competition. Acknowledgment The paper shows the author’s results within the frameworks of the study, performed in 2021−2023 at Kyiv National University of Trade and Economics at the request of Ministry of Education and Science of Ukraine “Digital transformation of trade, economic and tourist systems in Ukraine” (state registration number 0121U112231) and “Forecasting the impact of the tourism system on the country’s economy” (state registration number 0122U001559).

Price decisions with asymmetric reference effect and information sharing in dual-channel supply chains

This paper considers a retailer-manufacturer dual-channel supply chain (DCSC) consisting of a retail channel and a direct sale channel. Previous literature has shown that either asymmetric reference effect (ARE) or information sharing (IS) significantly impacts customers’ demand, then the channel members’ pricing decisions. As yet, no literature has examined the joint effect of both on the channel members’ pricing decisions, especially in a DCSC. To fill up the deficiency, we first explore and compare the pricing decisions in a centralized and a decentralized DCSC with ARE, respectively, with and without IS, using the Stackelberg game and two-stage optimization technique. Then we evaluate the values of ARE and IS by introducing model misspecification and numerical experiments. We find that substantial revenue will be lost if the retailer ignores ARE when information is shared than not shared, especially when the channel members are pessimistic about the market. A higher reference price or a weaker ARE induces the channel members to increase prices, and make IS more valuable to them. Besides, whether the information is shared or not, channel members generally underestimate revenues under a relatively high reference price, while overestimating the revenues under a relatively small reference price. Furthermore, the manufacturer conditionally accepts the IS while the retailer always accepts it.

Choice and Influence of Return Policy and Remanufacture in a Dual‐Channel Supply Chain

To investigate the choice of return strategy and its impact on a dual‐channel supply chain, a game model is constructed to analyze the equilibrium outcomes of five scenarios: no returns allowed, refunds without returns, returns allowed but no return shipping insurance, returns allowed and return shipping insurance purchased by the manufacturer, and returns allowed and return shipping insurance purchased by the consumer. The study found that manufacturers offering refund policies generate more sales in the direct online channel, while retailers choose to reduce the retail price of their products. It is important to note that price reductions by retailers have a very limited effect and do not lead to an increase in sales in the retail channel. Manufacturers offering refund policies will inevitably infringe on retailers’ profits, and the variability of manufacturers’ profits depends on the residual value of returned products. Manufacturers should decide whether to offer a refund policy in online direct sales channels based on the residual value of the returned product; otherwise, the action would be detrimental to themselves. The price of direct online sales is the same whether the manufacturer buys the return shipping insurance or the consumer buys the return shipping insurance, but when the return shipping insurance is bought by the consumer, sales are higher in the direct online channel and lower in the retail channel. When the return shipping cost reimbursement received after purchasing return shipping insurance is low, it should be purchased by the manufacturer, and when the return shipping cost reimbursement received after purchasing return shipping insurance is high, it will be better for the consumer to purchase return shipping insurance.

Pricing Decisions and Online Channel Selection Strategies in Dual‐Channel Supply Chains considering Block Chain

Pricing decisions and online channel selection strategies are playing an increasingly important role in e‐commerce. In this paper, we consider two different types of dual‐channel supply chain sales models, namely, an online direct + online distribution sales model consisting of an online direct sales channel and online distribution sales channel and an online direct + delegation sales model consisting of an online direct sales channel and an online delegation sales channel. By introducing the customer sensitive coefficient and block chain technology into these dual‐channel supply chain sales models, we analyzed pricing decisions and online channel selection strategies in dual‐channel supply chains in terms of the adoption and nonadoption of block chain technology. In the two different dual‐channel sales models, the results showed that (1) without block chain technology, retail prices increase when the manufacturer’s unit retail cost increases; (2) with block chain technology, retail prices are higher than those of sales models that do not adopt block chain technology; and (3) with block chain technology, the manufacturer should choose the online direct + delegation sales model to sell its products.

Optimal Pricing Decisions for Dual‐Channel Supply Chain: Blockchain Adoption and Consumer Sensitivity

Counterfeiting is common in many industries. For the authenticity of online channel products and to combat counterfeiting, many companies have begun to use blockchain technology to trace product information. This paper investigates a dual‐channel supply chain consisting of one manufacturer and one retailer, in which the manufacturer sells its standard products through the retailer and adopts blockchain technology to launch the online channel to sell the traceable products. A Stackelberg game is developed to depict the pricing decision and channel strategy choice for the manufacturer. It shows that both the manufacturer and the retailer can benefit from blockchain adoption. And the longer it takes for product traceability, the lower the price of online traceable products. It is beneficial for the manufacturer when consumers in the market are less concerned about information transparency. For consumer sensitivity, as consumers’ acceptance of direct sales channels increases, the selling prices of online traceable products have risen. Furthermore, as the traceability time‐sensitivity coefficient increases, the sales price of the traceable products decreases, and the retail price of offline standard products rises. The conclusion of this paper has a certain guiding role for the dominant manufacturers in choosing whether to apply blockchain technology to improve the demand for traceable products.

BUSINESS MODEL CANVAS UNTUK MENGEMBANGKAN STRATEGI BISNIS KERIPIK PISANG (STUDI KASUS UKM SELERAKU DI KABUPATEN BANJARNEGARA)

One of the business models used to develop a banana chips business strategy is the canvas business model. The purpose of this research is to find out how to apply the business model canvas and the customer emphaty map and the design of its transformation to develop the banana chips business strategy of Seleraku Banjarnegara UKM. The research method used is participatory action research and descriptive analysis. Data analysis used analysis of the business model canvas and the customer emphaty map. The research results are as follows; (1) business model canvas to develop a banana chip business strategy at Seleraku Banjarnegara SMEs, customer segments include children to the elderly, healthy snack/snack consumers, and resellers with value propositions covering the quality of raw materials, healthy snacks/snacks, and products easy to find. The company uses direct sales channels and reseller and customer relationships in the form of excellent and professional service for customers. Key activities include production and marketing activities by utilizing key resources which include human, physical and intellectual resources. The key partnership consists of banana farmers and resellers. The company generates revenue streams from the sale of banana chips as the main product with cost structures consisting of fixed costs and variable costs, (2) the design of business model transformation as a company development strategy needs to be done while maintaining the current channels and key resources. Additions were made to value propositions in the form of delivery order services. The use of social media in customer relationships, generates revenue streams from the sale of banana peel chips, adds social activities to key activites, adds partners consisting of distributors, event organizers and delivery services for key partnerships, and increases costs for social activities on cost structures.

Retraction Note: Prediction of soil moisture characteristic curve based on Internet of Things and enterprise e-commerce operation

E-commerce has an important influence on China’s economic and social development. The rapidly emerging Internet of Things and other emerging information technologies can promote the revolutionary innovation and development of e-commerce products and industries. Online direct sales channels fully apply the Internet of Things technology and e-commerce. The operations and channels have more power to apply the Internet of Things technology. If offline business operations have stronger advantages than online e-commerce operations, the Internet of Things technology and the diffusion process are incorporated into the database model; when the proliferation of the Internet of Things remains local, e-commerce operations can only obtain higher efficiency and benefits after applying the Internet of Things technology online, to closely integrate the new generation of information technology with traditional operating strategies. At the same time, government support policies have played an important role in promoting the application of a new generation of information technology. The particle gradation, stress status, dry density, etc., in the soil moisture characteristic curve prediction system may change with the operation of the soil in the atmosphere, and these influencing factors are important measurements that affect soil permeability and land water quality characteristics. The prediction of soil moisture characteristic curve, soil permeability, and soil erosion resistance are linked together, and the study of the influence of these influencing factors on soil permeability and soil moisture characteristics on soil water retention is useful for exploring the mechanism of soil erosion and soil erosion. Sexual control measures have very important guiding significance. Therefore, this paper uses the Internet of Things technology to conduct a detailed study on the prediction content of the soil moisture characteristic curve and the process of enterprise e-commerce operations.

Improve it or reveal it? Product innovation and demonstration decisions under different supply chain contract modes

When consumers are uncertain about their choice of a product, the product innovation effort and the product demonstration level will significantly affect product sales. Under the impact of factors such as contract mode, channel competition, and product competition, the relationship between firms’ decisions on innovation effort and demonstration level will become more complicated. This study comprehensively models and analyzes the interaction between the manufacturer's product innovation effort and the retailer's product demonstration level in a dual-channel supply chain under either the agency contract mode or the wholesale contract mode. In our model, a manufacturer sells his innovative product through a retailer’s physical store under wholesale or agency contract mode, as well as his direct online channel. The results show that under two contract modes, the trend of the demonstration level is almost opposite. Moreover, the correlations between the innovation effort and the demonstration level decisions under the two contract modes are opposite. From the perspective of marketing strategy, when the potential market of the innovative product is not too small, the penetration strategy is preferred under the agency contract mode, whereas the skimming strategy is preferred under the wholesale contract mode. In certain conditions, two firms can achieve Pareto optimality by choosing the agency contract mode. Besides, we find that the consumer showrooming behavior makes two firms more likely to achieve Pareto optimality, while the manufacturer’s introduction of the online direct sales channel will not hurt the retailer, who can avoid the loss of profit by adjusting the product demonstration level decision.

Quantum Game of Dual-channel Supply Chain under Free-riding Behavior

Based on the perspective of the quantum game, this paper explores when the online direct sales channel takes the free-riding behavior after the retail channel provides high-quality experience and services and how the dual-channel supply chain establishes a commodity pricing strategy. The retailer’s selling price follows a decreasing function of the free-riding behavior coefficient. while the online direct selling price does an increasing function of the free-riding behavior coefficient. Under centralized decision-making, there is no quantum entanglement, so the quantum game solution is consistent with the classical game solution. Under decentralized decision-making, the optimal price and profit of the quantum game are higher than those of the classical game when the quantum entanglement degree is greater than zero. When the quantum entanglement tends to be infinite, the optimal price of the quantum game finally remains in convergence. The quantum game theory is a more optimal decision-making method than the classical game theory.

The interplay between blockchain adoption and channel selection in combating counterfeits

This study explores the interplay between blockchain technology (BCT) adoption and channel selection in combating counterfeits and examines the impact of this interaction on consumer surplus (CS) and social welfare (SW). Firstly, analytical models are developed to examine four scenarios (with and without BCT adoption and two channel scenarios). Secondly, the impacts of BCT adoption and channel selection decisions on CS and SW are analyzed. Finally, we relax our assumptions to consider the presence of the dual-channel sales model, risk-averse consumers, and expert consumers. The main findings are as follows: (1) Genuine companies should sometimes sell through dual sales channels before adopting BCT; however, they should always sell through a single sales channel after adopting BCT. Furthermore, BCT changes the optimal single sales channel from the retailer channel to the direct sales channel when the proportion of deceptive counterfeits in the direct sales channel is relatively high. (2) Both consumers and the whole society will benefit from the deployment of BCT when all sales channels of a company are either less reliable or highly unreliable. (3) BCT is valuable in combating counterfeits, especially when the risk aversion level of consumers is not sufficiently low or the proportion of expert consumers is sufficiently low.