Research on return strategy in the presence of strategic consumers
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    Abstract:

    The prevalence of Internet,online consumer reviews and seller’s frequent discount strategies cantrain consumers’strategic waiting behavior,which deteriorates product mismatch between supply and demand. On the other hand,the“insurance mechanism”behind the return strategy via improving consumers’willingness to pay for product encourages more consumers to buy products at the regular price,which in turn results in plenty of returned products.How to deal with these returned goods has become a core problem the seller must face.This paper analyze how the three reprocess strategies of returned goods,i.e.,non-resale,regular resale,and discount resale strategy,influence the seller’s return strategy design.Our conclusion shows that: compared with the no return strategy,1) The non resale and discount resale strategies decrease the seller’s expected profits; 2) When both regular reprocess cost and refund are small,the regular resale strategy could increase the seller’s expected profits,however,if either regular reprocess cost or refund is large,the regular resale strategy is also detrimental to the seller’s profitability.

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  • Online: April 17,2018
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