We consider a two-echelon supply chain consisting of one supplier and one capital-constrained retailer. The supplier can offer the retailer trade credit to fund his orders. To boost sales, the retailer invests part or all of initial capital exclusively in advertising at the beginning of the sales season. Demand is sensitive to both retail price and advertising expenses of the retailer. With a wholesale price contract, we analytically derive the Stackelberg equilibrium with respect to pricing by both parties and advertising by the retailer. Our results show that the retailer with less initial capital prefers to invest full initial capital in advertising irrespective of the advertising elasticity or the interest rate charged by the supplier. The retailer with more initial capital only invests part of initial capital in advertising. The retailer’s advertising policy under different initial capital levels always benefits the supply chain and the supplier. We further identify the effects of the advertising elasticity and the interest rate on the pricing policies. Numerical simulations and sensitivity analysis are given to elaborate our theoretical results.
Accepté le :
DOI : 10.1051/ro/2018111
Mots-clés : Supply chain management, capital-constrained retailer, trade credit, advertising and pricing policies
@article{RO_2019__53_4_1331_0, author = {Yang, Honglin and Chu, Lingling and Wan, Hong}, title = {Advertising and {Pricing} {Policies} in a {Two-Echelon} {Supply} {Chain} with a {Capital-Constrained} {Retailer}}, journal = {RAIRO - Operations Research - Recherche Op\'erationnelle}, pages = {1331--1342}, publisher = {EDP-Sciences}, volume = {53}, number = {4}, year = {2019}, doi = {10.1051/ro/2018111}, zbl = {1425.90013}, mrnumber = {3989602}, language = {en}, url = {http://www.numdam.org/articles/10.1051/ro/2018111/} }
TY - JOUR AU - Yang, Honglin AU - Chu, Lingling AU - Wan, Hong TI - Advertising and Pricing Policies in a Two-Echelon Supply Chain with a Capital-Constrained Retailer JO - RAIRO - Operations Research - Recherche Opérationnelle PY - 2019 SP - 1331 EP - 1342 VL - 53 IS - 4 PB - EDP-Sciences UR - http://www.numdam.org/articles/10.1051/ro/2018111/ DO - 10.1051/ro/2018111 LA - en ID - RO_2019__53_4_1331_0 ER -
%0 Journal Article %A Yang, Honglin %A Chu, Lingling %A Wan, Hong %T Advertising and Pricing Policies in a Two-Echelon Supply Chain with a Capital-Constrained Retailer %J RAIRO - Operations Research - Recherche Opérationnelle %D 2019 %P 1331-1342 %V 53 %N 4 %I EDP-Sciences %U http://www.numdam.org/articles/10.1051/ro/2018111/ %R 10.1051/ro/2018111 %G en %F RO_2019__53_4_1331_0
Yang, Honglin; Chu, Lingling; Wan, Hong. Advertising and Pricing Policies in a Two-Echelon Supply Chain with a Capital-Constrained Retailer. RAIRO - Operations Research - Recherche Opérationnelle, Tome 53 (2019) no. 4, pp. 1331-1342. doi : 10.1051/ro/2018111. http://www.numdam.org/articles/10.1051/ro/2018111/
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