Profit Of Retailer Research Articles

An agent-based simulation for a trade-off between frequency and depth in retail price promotion strategy

Abstract A good pricing strategy helps retailers generate profits, increase sales, and set a strategic position in the market. However, the interactions between retailers and customers add complexity to retailer pricing decisions. This study aims to model retail pricing complexity and analyse retail pricing strategies using an agent-based simulation approach. Two types of agents are modelled: customers and retailers. Customer buying decisions are influenced by several customer preferences factors, while product prices are set according to the retailer’s promotion strategy. The promotion is applied based on the frequency and depth of the price cut. A functional product market is considered in this simulation, representing daily necessities that are purchased regularly, such as foodstuffs and toiletries. The results show that the limited rationality and interactions of each agent drive the unique behaviour of the system, and that each pricing strategy has a different impact on retailer profit and market share. This study provides insights into pricing decision strategies related to price promotion.

Strategizing Retailing in the New Technology Era

The world of retailing is being reimagined and transformed at breakneck speeds due to new technologies, as well as due to changes in consumer purchasing behavior resulting from the COVID-19 pandemic. This dynamic retail marketplace is forcing retailers to strategize how to best position themselves to survive and flourish in this environment. Recognizing that we are at a critical inflection point in the world of retailing, we conceptualize a Strategic Wheel of Retailing in the new technology era that emphasizes technology as the core enabler of the strategies related to the 6Ps of retailing (retail place and supply chain management, product, pricing, promotion, personnel, and presentation). In particular, the articles calls for retailers to carefully their review their competitive ecosystem as they adapt to the new technologies, raises some issues, and offers new directions for further research on how technology can be leveraged to design profitable retail strategies.

A technical and economic approach to multi-level optimization models for electricity demand considering user-supplier interaction

One-level optimization methods have been proposed to optimize a single user’s load profile or a cluster of users in the smart grids. In this work, two two-level optimization methods are studied, one case considering technical requirements (case 1) and another considering economic criterion (case 2). At the upper level, the supplier optimizes the objective function. Meanwhile, at the lower level, users optimize their electrical costs. The proposed methods are based on Genetic Algorithm methods. In this sense, an indirect control is established in which users react to a price signal. Simulation results illustrate that both cases improve the demand profile and increase the retailer profit concerning an unscheduled case. However, when the supplier tries to maximize the profit, some users receive benefits to the detriment of others, concluding that the technical approach is preferable to the economic one.

Retail channel management decisions under collusion

In unprofitable business circumstances, collusion may work to save investment and operations costs, which could fight off fierce business competition. However, collusive behavior may incur adverse impacts on consumers and multi-channel decisions in a supply chain. A common approach to deterring collusive behavior involves setting financial penalties. However, severe punishment could limit economic activities. To align with regulations and boost market vitality, in this paper, we investigate how the manufacturer chooses a competitive selling channel in a complex environment, and how it can design a compensation plan that can effectively mitigate such unethical behavior and coordinate the whole supply chain (channel). We find that collusion is an ‘unstable equilibrium’ and only works when both retailers are comparable. That is, when the retail market is extremely dominated by a stronger retailer, the profit of a smaller retailer would be gobbled up by the stronger one. Retailers’ collusion against the manufacturer seems like an advantageous strategy to maximize their profits, but we find that the retailers’ profits may be reduced because of collusion unless they are facing a greater market base. We then show that the profit margins of the manufacturer and the whole supply chain are squeezed; thus, introducing the online platform is one essential way for the manufacturer to address such collusion. We further propose a compensation and incentive contract with effective penalties through differentiating wholesale prices for retailers, which benefits the whole supply chain in terms of high profits. The key findings can provide useful decision support and operational guidelines for manufacturers with respect to making strategic retail channel management decisions.

Emission reduction decision of agricultural supply chain considering carbon tax and investment cooperation

As the core of civilian production and an indispensable part of the national economy, the agricultural industry plays a role in many aspects, but it also generates a large amount of carbon emissions that are harmful to the environment. A game model is established to compare the optimal decisions and profits of retailers under three situations: whether to invest in emission reduction for manufacturers or not, and whether to invest in emission reduction under decentralized decision-making or centralized decision-making. The results show that when manufacturers cooperate with retailers, with the increase of investment proportion, carbon emission reduction, market demand, manufacturer’s profit and retail price show an upward trend, while retailer’s profit decreases. However, when manufacturers and retailers form a centralized supply chain, the overall profit of the supply chain can be improved. Therefore, when manufacturers and retailers cooperate to form a centralized supply chain, the supply chain can be optimized to achieve the dual objectives of protecting the environment and increasing profits.

Pricing policies of dual-channel green supply chain: Considering government subsidies and consumers' dual preferences

With the increasing attention of global governments to environmental issues, the concept of environmental protection has been introduced into the supply chain, and green supply chain management has become particularly important. Based on this, this paper uses the research method of Stackelberg game theory to propose the green supply chain model with a dual-channel structure, in which consumer green preference and channel preference are considered. In addition, two cases of government subsidies and no government subsidies are also considered. The paper is aimed to explore products collaborative pricing policies in dual-channel green supply chain, and compare the optimal solutions in two cases. Findings illustrate that government subsidies will reduce green products’ price, and effectively promote the sales of green products; government subsidies are beneficial to the manufacturer, and the impact on retailer's profit depends on the amount of government subsidies; the higher the consumer's green preference or the lower the offline channel preference, the greater the demand for green products. The research findings can provide useful insights for members of the dual-channel green supply chain to make optimal decisions with and without government subsidies, thereby enhancing the market competitiveness of green products.

Cooperative advertising contract design in a supply chain with an offline showroom under asymmetric information

We investigate an online retailer’s cooperative advertising contract design where an offline showroom advertises to attract consumers to evaluate the product offline and buy it online. Considering the impact of advertising effort, retail price of the product and the probability that the product fits consumers’ needs on demands, we design the optimal cooperative advertising contract under symmetric and asymmetric information. Then, we identify the impact of important factors on contract design and profits of supply chain members. We find that under asymmetric information, the online retailer can adopt two different contract strategies, in one of which information asymmetry does not reduce profit of the online retailer and efficiency of the whole supply chain. The above result suggests the online retailer that choosing the optimal strategy can sometimes combat the ill-effect of information asymmetry. We also find that the impact of unit return handling cost on the optimal contract depends on the balance of the direct effect and the spillover effect of advertising. In some conditions, supply chain members obtain lower profits as offline potential demand increases. Besides, the spillover effect does not always increase supply chain members’ profits.

Decisions and coordination of retailer-led low-carbon supply chain under altruistic preference

A low-carbon supply chain formed by a dominant retailer and a small and medium-sized manufacturer (SMM) is considered. Because the SMM faces the high cost pressure of adopting carbon emission reduction (CER) technologies, the retailer may take an altruistic preference for the long-term sustainability of the chain. Three decision-making models, centralized, decentralized without altruistic preference, and decentralized with altruistic preference, are constructed to compare decisions and profits of both parties. Since neither decentrailized models can lead to a coordinated solution that is incentive compitable, a coordination contract, referred to as the cost sharing contract with altruistic preference, is proposed. Numerical study shows that the altruistic preference can help increase the SMM's profit and system efficiency but decrease the retailer's profit. The coordination contract requires the retailer to adjust the unit profit and share more than half of the CER cost. It is found that the wholesale price is the lowest in the coordination contract and the comparison of unit profit depends on the coefficient of CER cost.

Product Greenness and Pricing Strategy of Supply Chain Incorporating Asymmetric Heterogeneous Preferences

The decision making of product greenness and pricing strategy is important to achieve sustainable competitiveness of supply chain systems. Behavioral studies find that individual preferences, such as altruism and fairness, can affect the decision and performance of the supply chain significantly. However, the previous widely adopted assumption contradicts the private, asymmetric, and diverse behaviors in reality. This paper considers a green supply chain with asymmetric heterogeneous preferences, in which the manufacturer does not know whether the behavioral type of the retailer is self-interest or altruistic. The optimal decisions on product greenness and pricing strategy of the supply chain under asymmetric heterogeneous preferences are obtained with a game analytic model of incomplete information. The impact of asymmetric preferences on product greenness, price, and supply chain performance is attained by comparing the results under symmetric and asymmetric scenarios. How heterogeneous preferences change the impact of asymmetric preferences is presented with sensitivity analysis. The case study illustrates and verifies the impact of asymmetric preferences, and its sensitivity with respect to heterogeneous preferences. The findings show that asymmetric preferences will reduce the product greenness and wholesale price decided by the manufacturer, will enhance the retail price decided by the self-interest retailer, and meanwhile reduce that decided by the altruistic retailer. Moreover, asymmetric preferences will decrease the manufacturer's profit, reduce the self-interest retailer's profit, and enhance the altruistic retailer's profit while reducing the altruistic retailer's utility. Their influence extents will increase in the heterogeneity of preferences with few exceptions in cases of the self-interest retailer's profit and the altruistic retailer's utility. The theoretical findings generate some managerial implications, by which for example it is necessary to adjust promptly the estimation about the behavior types of supply chain partners.

The Impact of Private Label Introduction on Assortment, Prices, and Profits of Retailers

The Impact of Private Label Introduction on Assortment, Prices, and Profits of Retailers

A Theory of FinTech and Trade Finance

Problem Definition: Smart contract improves the supply chain efficiency by enabling the supplier's commitment to post-shipment financing that mitigates the bank's lending risk exposure and thereby reduces the financing cost. Invoice trading offers better liquidity and faster transaction speed, which allow the supplier to make the post-shipment financing decision upon liquidity shock in contrast to factoring market. This paper investigates how these two types of FinTech adoptions could facilitate the trade finance activities and create value for supply chain firms. Academic/Practical Relevance: As the emerging FinTechs could potentially reshape the trade financing landscape, understanding the impact of FinTech adoption and its interaction with trade finance activities is practically relevant and of great importance. Methodology: We develop a two-stage game-theoretic model and adopt supply chain finance theory to characterize firms' operations and financing strategies in the presence of various FinTech applications. Results: We find that the value of FinTech adoption depends critically on the trade financing structures, including both pre-shipment and post-shipment financing schemes. Under the baseline trade finance model (with purchase order financing and traditional factoring), smart contract leads to win-win outcome for the supplier and the retailer. When buyer direct financing is adopted for pre-shipment financing, smart contract might demotivate the retailer to offer buyer direct financing, which benefits the retailer but significantly hurts the supplier and therefore reduces the supply chain profit. When on-demand invoice trading is adopted for post-shipment financing, the supplier and retailer profit are increased due to its flexibility. However, it completely wipes out the value of smart contract since there exists no commitment issue. Lastly, though supply chain digitalization facilitated by FinTech helps lower the financing cost, it might either hurt the supplier or the retailer. Managerial Implications: Our findings provide guidelines for and insights into when smart contract and invoice trading should be adopted and their interactions with different trade finance schemes. In particular, such FinTechs do not always enhance the supply chain value.

A sustainable closed-loop supply chain in a two-period: a game theory approach

The closed-loop supply chain considers forward and reverse logistics. This paper assumes a two-period setting to demonstrate the interaction and effect of periods on the supply chain. In the first period, the manufacturer acts as a leader which produces new products and sells them to the retailer, and the retailer sells them to customers. In the second period, the manufacturer collects used-products to take profit. The objective of this study is to take care of economic, green, and social issues for both manufacturer and retailer in both periods. It presented a flexible solution method in two phases. A numerical example is presented and solved by applying the proposed solution method. Results indicate that the manufacturer as a leader obtains more profit, whereas the retailer is more sensitive towards the discount rate. Moreover, the retailer's profit is more sensitive to the proportion of returned used products than the manufacturer's profit. [Received: 15 April 2019; Accepted: 15 March 2020]

Pricing and Coordination in a Dual-Channel Supply Chain With Product Variety Under the Countervailing Power of the Retailer

To investigate pricing strategy and coordination mechanisms of the dual-channel supply chain with a retailer that has countervailing power to the manufacturer, we consider the effect of product variety in developing decentralized and centralized dual-channel supply chain game models. By solving these modes and comparing the results, we find the following: (i) The retailer's offline retail price is greater than the online retail price of the manufacturer when the retailer's market share is greater than the online market shares of the manufacturer under the centralized model. (ii) Online and offline product demand in a centralized supply chain increases with product variety. (iii) The relationship between offline retail price, wholesale price, and product variety depend on the threshold of the offline channel's market size. The wholesale price decreases with the countervailing power of the retailer. (iv) The relationship between offline retail price and demand in centralized and decentralized supply chains is related to the product variety threshold. Furthermore, manufacturer and total supply chain profit first rises and then declines, whereas the retailer's profit steadily increases with the degree of product variety. Two-part tariff pricing contracts can coordinate a decentralized model to obtain the same profit as that in a centralized model.

Can cost sharing contracts coordinate green supply chains based on manufacturers’ overconfidence

Cost sharing contracts is one of the most common contracts to coordinate green supply chains. In this paper, we examine whether it can coordinate green supply chains in the set up of overconfidence. We assume that the manufacturer is overconfident and the retailer is rational. The manufacturer overestimates consumers’ sensitivity to product greenness and accurately estimates the uncertainty of demand. The overconfident manufacturer and the rational retailer cooperate through cost sharing contracts. Then, we construct a game theoretical model to analyze the impact of manufacturers’ overconfident on product greenness, pricing, profit and supply chain cooperation. At last, a numerical experimentation is presented. We find that, (1) the product greenness, wholesale price and retail price increase with the manufacturer’s overconfidence as well as the retailer’s cost sharing proportion. (2) no matter how much the cost sharing proportion is, the profit of manufacturers and retailers decreases with the manufacturer’s overconfidence level. (3) cost sharing contracts can achieve the green supply chain coordination in rational setting. But under manufacturers’ overconfidence, it cannot.

Research on Game Strategy of Green Supply Chain under Different Subsidy Policies

This paper discusses the retailer-manufacturer Stackelberg model under the background of green supply chain. The manufacturer needs to decide product green degree and the retailer needs to determine green promotion levels. This study considers the optimal decision-making, profit and social welfare of each member of the supply chain under the three decision scenarios: government does not subsidize, government subsidizes manufacturers, and government subsidizes retailers, in order to provide reference for the government to promote the implementation of green supply chain strategies. The results show that government subsidies have a positive effect on the implementation of green supply chains. Moreover, the government's strategy of subsidizing manufacturers will improve the product green degree, social welfare, and the profits of manufacturers and retailers. And the strategy of subsidizing manufacturers is shown to be better through comprehensive analysis. When consumers' preference for green products is low, the green promotion level is highest when retailers are subsidized, but the unit subsidy gain of social welfare is greater when manufacturers are subsidized.

The Chinese minority in Bucharest: A case study of Chinese children raised and cared for by Romanian nannies

Since 1990, many Chinese immigrants have come to Romania. These Chinese persons are full time involved in the profitable wholesale and retail trade activities; they have families and children, cared for by Romanian nannies. The study is focused on the particularities of an intercultural dialogue, unique and recenlty highlighted in the Romanian society: between the Romanian nannies and Chinese children, located in a representative urban area for the Chinese minority. The aim of paper is to analyses how two cultures have interacted for the purpose of child care, focusing on the ways in which the life, experiences, attitudes and opportunities of Chinese children are socially and spatially shaped, influenced and structured by cultural features of the Romanian nannies.

Pricing and green innovation decision of green supply chain enterprises

With the development of globalisation, people's awareness of environmental protection is gradually increasing. The purpose of this article is to study how companies can avoid risks, improve market competitiveness, and expand their profits under the concept of green innovation. From the perspectives of competitive environment, risk aversion and supply chain innovation, this paper uses game theory to analyse the number of green supply chain companies and how companies can achieve green pricing and decision-making innovation, and compared the different sales models of retailers, manufacturers and middlemen. The results of the study are as follows: the green innovation model has increased the profits of retailers and manufacturers by 20.53%; and 34.09%, and the revenue increase rates of the three sales models are 31.43%, 39.39%, and 41.67%, respectively.

Advance sustainable inventory management through advertisement and trade-credit policy

The concept of advanced sustainable inventory management, where demand pattern stock level and advertising dependent under trade-credit policy is taking account in this present study. Optimal credit period and cycle time are the main objective of this advanced system. A developed solution methodology is derived to show the existence of global optimality under optimum credit period and cycle time. The main concern of this advanced system is to maximize the annual total system profit of retailer with finite replenishment rate. Numerical illustration are carry forward for different cases to prove the stainability along with real impact of this model. Sensitive analysis for the key parameters is discussed in sensitivity analysis section along with some real managerial insights.

Pricing and green innovation decision of green supply chain enterprises

With the development of globalisation, people's awareness of environmental protection is gradually increasing. The purpose of this article is to study how companies can avoid risks, improve market competitiveness, and expand their profits under the concept of green innovation. From the perspectives of competitive environment, risk aversion and supply chain innovation, this paper uses game theory to analyse the number of green supply chain companies and how companies can achieve green pricing and decision-making innovation, and compared the different sales models of retailers, manufacturers and middlemen. The results of the study are as follows: the green innovation model has increased the profits of retailers and manufacturers by 20.53%; and 34.09%, and the revenue increase rates of the three sales models are 31.43%, 39.39%, and 41.67%, respectively.

Don't Bite the Hand That Feeds You: Food Pantries and Food Retailer Profitability

This paper examines the extent to which the presence of food pantries diverts food sales from retail grocers. Hunger-relief programs, such as food services provided through food banks, serve as emergency assistance to meet households' temporary food needs, yet a growing population in the United States regularly relies on these services. There is little empirical research that examines just how individuals factor hunger-relief programs into their planning horizons, whether the presence of these organizations diverts sales from grocers, and how that affects food retailers' revenues and profits. Further, the presence of multiple grocers in one market constitutes a common good problem, given that the savings in food waste disposal fees occur for each retailer privately, while a potential reduction of total demand affects all retailers' sales. Using data on the location of food pantries and annual sales volume from retail grocers in Arizona, we measure the statistical relationships between food pantry density and retail grocers' annual sales volume. Preliminary results show that food pantry presence does not statistically, significantly affect retailers' revenues, suggesting that food pantries and food retailers do not directly compete for market share.