Pricing and quality competition for substitutable green products with a common retailer

Saha, Subrata; Banaszak, Zbigniew; Bocewicz, Grzegorz; Nielsen, Izabela

doi:10.1007/s12351-021-00656-z

Cited by 14 publications

(6 citation statements)

References 57 publications

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“…The authors found that the contract mechanism can ensure coordination if the RS percentage remains the same for both products. In a similar supply chain structure, Saha et al (2022) also found the RS contract can distribute profits arbitrarily among participants. The present study expands the literature on RS contracts by studying their effectiveness as a strategic tool, not for achieving supply chain coordination.…”

Section: Customer Rebate Vs Contract Mechanismmentioning

confidence: 93%

“…Since the two products are partially substitutes, the impact of p tj on q ti is of a lesser magnitude than that of p ti . The linear-demand function for the first period is also common in the literature (Demirag et al , 2011; Ha et al , 2017; Bian et al , 2020; Saha et al , 2022).…”

Section: Model Descriptionmentioning

confidence: 99%

“…Following Anand et al (2008) and He et al (2019), we assume that decisions for each member are observable to keep our focus on exploring the strategic measure. To derive the optimal response of the members, we use a decision sequence similar to Wang et al (2014), Rofin and Mahanty (2018), Saha et al (2022) where two manufacturers simultaneously decide wholesale prices and the rebate offering manufacturer sets rebate values to maximize their profits and then the retailer decides the order quantity for each product. To analyze the strategic action for the NRM and reduce analytical complexity, we assume the two manufacturers are symmetrical; production costs for the manufacturers and operational costs for the retailer are normalized to zero (Bian et al , 2020).…”

Section: Model Descriptionmentioning

confidence: 99%

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Perspectives of two competing manufacturers: customer rebate vs. contract mechanism

Majumder

Nielsen

Maity

et al. 2023

JM2

Self Cite

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Purpose This paper aims to analyze the potentials of dynamic, commitment and revenue-sharing contracts; that a nonrebate offering manufacturer can use to safeguard his profit while his competitor offers customer rebates in a supply chain consisting of two manufacturers and a common retailer. Design/methodology/approach We consider a two-period supply chain model to explore optimal decisions under eight possible scenarios based on the contract and rebate offering decisions. Because the manufacturers are selling substitutable products, therefore, a customer rebate on one of the products negatively impacts the selling quantity of other. Optimal price, rebate, and quantities are examined and compared to explore the strategic choice for both the rebate offering and non-rebate offering manufacturer. Comparative evaluation is conducted to pinpoint how the parameters such as contract parameters and its nature affect the members. Findings The results demonstrate that all these contracts instigate the rebate offering manufacturer to provide a higher rebate, but do not ensure a higher profit. If the revenue sharing contract is offered to the common retailer, the effectiveness of the rebate program might reduce significantly, and the rebate offering manufacturer might receives lower profits. A non-rebate offering manufacturer might use a commitment contract to ensure higher profits for all the members and make sure the common retailer continues the product. Originality/value The effect of customer rebate vs. supply chain contract under competition has not yet been explored comprehensively. Therefore, the study contributes to the literature regarding interplay among pricing decision, contract choice and rebate promotion in a two-period setting. The conceptual and managerial insights contribute to a better understanding of strategic decision-making for both competing manufacturers under consumer rebates.

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Section: Customer Rebate Vs Contract Mechanismmentioning

confidence: 93%

Section: Model Descriptionmentioning

confidence: 99%

Section: Model Descriptionmentioning

confidence: 99%

See 1 more Smart Citation

Perspectives of two competing manufacturers: customer rebate vs. contract mechanism

Majumder

Nielsen

Maity

et al. 2023

JM2

Self Cite

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“…Liu et al (2020) compared the effectiveness of different contracts in motivating enterprises to enhance product greenness and reap associated benefits across diverse power structures. Saha et al (2022) explored the impacts of power structures on optimal pricing and green level decisions for green products. However, to the best of our knowledge, there is a scarcity of literature that takes into account the power relationship between green and non-green manufacturers and analyzes the production and marketing decisions between these two competing entities under varying power structures.…”

Section: Power Structurementioning

confidence: 99%

How green advertising and power structures affect competition between green and non‐green manufacturers?

Wu,

Cao,

et al. 2024

Manage Decis Econ

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Considering scenarios with and without green advertising, we compare the optimal solutions and performance of both green and non‐green manufacturers under three power structures. Green manufacturers who invest in green advertising experience enhanced output and profits, with the highest level of green advertising and profit improvement when they dominate market. In most cases, green advertising investment tends to decrease the output and profits of non‐green manufacturers. However, under specific circumstances, such as when non‐green manufacturers dominate market and the production cost of green products exceeds a certain threshold, investing in green advertising can unexpectedly stimulate demand for non‐green products.

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“…Therefore, q s i is positively correlated with own product quality(θ s i ) and retail price of other product (p s j ); and negatively correlated with other product quality (θ s j ) and own retail price (p s i ). The linear demand function is common in the literature [38,42]. Moreover, there are some studies where only quality impact is considered [43] or only retail price is considered [44].…”

Section: Model Settingsmentioning

confidence: 99%

Effect of Product Distribution Structures and Government Subsidy Measures on Product Quality and Consumption under Competition

Majumder¹,

Nielsen

Maity³

et al. 2022

Sustainability

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To improve social welfare and the sustainable development index, many governments introduce subsidies to manufacturers. Motivated by a subsidy program, we present a parsimonious analysis to determine the impact of subsidies when two competing manufacturers use different distribution structures under competition to sell their products in a three-echelon distribution setting. The objective is to understand better how distribution structures and social welfare measures affect the government’s decision to subsidize. We consider four different distribution structures where the government can provide subsidies to both the manufacturers or one of them. From the perspective of the social welfare optimization goal, we consider two well-established measures to analyze whether those measures impacted the overall dynamics. The two key areas: (i) the effect of distribution structures and (ii) decisions under different social welfare measures are not discussed comprehensively yet. We found that distribution structure significantly impacted product qualities, prices, and amount of government expenditure. The government may need to pay more subsidies in a distribution structure with a two-manufacturers-two-distributors-two-retailers distribution setting, where customers can receive a higher-quality product and pay a higher price. Our analysis reveals that the government’s social welfare goal can change the dynamics. Among four distribution structures, none can simultaneously ensure higher quality, product consumption, supply chain profits, and lower prices. The results provide insights for developing practical government subsidy program goals under competition.

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Pricing and quality competition for substitutable green products with a common retailer

Cited by 14 publications

References 57 publications

Perspectives of two competing manufacturers: customer rebate vs. contract mechanism

Perspectives of two competing manufacturers: customer rebate vs. contract mechanism

How green advertising and power structures affect competition between green and non‐green manufacturers?

Effect of Product Distribution Structures and Government Subsidy Measures on Product Quality and Consumption under Competition

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