A common strategy to increase sales and profit is to combine different types of products into bundles and sell at a discounted price. In this study, we consider the case where a wholesaler offers to sell two types of products through discount bundles. Each of the two types of products is purchased from a producer in lots that contain a percentage of imperfect quality items, which is a random variable having a known probability density function. Items received from the producer are inspected for imperfect quality using a 100% screening process. The perfect quality items are used to make the discount bundles, while the imperfect quality items are sold at a discounted price at the end of the screening period. Items of perfect quality of one type that are not bundled are kept in stock to be used in the next inventory cycle. A mathematical model is developed to determine the total profit function. A closed-form formula for the wholesaler's optimal order quantity of each type of product is determined by maximizing the profit function. The optimal solution is given in terms of the expected values of functions involving the two random variables representing the percentages of perfect quality items. Numerical examples are provided to illustrate the model, and simulation is used to calculate the optimal solution.
Consumers are increasingly seeking information through Social Media (SM) platforms to guide their future purchasing decisions. Electronic Word-of-Mouth (eWOM) through the ever popular SM, especially among young consumers, can have great influence on consumers' perception and buying intention. In this paper, we analyze consumer behavior of university students in Lebanon through studying the effect of their SM habits and impact of eWOM on their purchase habits and intentions. SM considered Facebook, Twitter, Instagram, and Snapchat; eWOM refers to recommendations by friends and experts. A conceptual model is presented and tested empirically taking advantage of data collected from different universities. The model tests the mediating effects of eWOM on the relationship between SM usage of students on their purchase intentions of products discussed on SM platforms by friends and experts. A sample of 200 university students in Lebanon who responded to an online survey is used to examine proposal model. Partial least square structural equation modeling (PLS-SEM) through the Smart PLS3 software is used to analyze survey data. The preliminary results support the hypothesis that the more time students spend on SM, the more likely they will be influenced by e-WOM by friends and experts which in turn might influence their buying intentions.
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