Retailer’s fixed markup of chain-to-chain competition under demand uncertainty and vertical restraints
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    Abstract:

    Based on chain-to-chain price competition model which was defined by two manufacturers and two exclusive retailers under demand uncertainty and vertical restraints,this paper not only identified the market conditions of performance improvement equilibriums for supply chain’s members when the manufacturer adopted the contract of the retailer’s fixed markup,but also investigated the impact of demand risk,market size,market share,price competition,demand forecast ability and markup ratio on the performance improvement equilibriums.The results show that: when price competition between the two competing supply chains is weaker relatively and market share is bigger relatively,the retailer’s fixed markup will improve the whole supply chain’s performance and produce a dominant equilibrium and Bayesian equilibrium for the whole supply chain; what is more,if the markup ratio is relatively modest and the demand risk is not very high,or the markup ratio is bigger relatively and the demand risk is relatively modest at the same time,the retailer’s fixed markup will realize a dominant equilibrium and Bayesian equilibrium for both the manufacturer and retailer.However,when price competition is very fierce,the wholesale price contract will produce a dominant equilibrium and Bayesian equilibrium for the whole supply chain.

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  • Online: April 17,2018
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