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Sustainability 2014, 6(7), 4339-4354; doi:10.3390/su6074339

The Equilibrium Decisions in a Two-Echelon Supply Chain under Price and Service Competition

1
Department of Mathematics, Tianjin University, Tianjin 300072, China
2
School of Information Engineering, Tianjin University of Commerce, Tianjin 300134, China
*
Author to whom correspondence should be addressed.
Received: 24 March 2014 / Revised: 1 July 2014 / Accepted: 8 July 2014 / Published: 14 July 2014
(This article belongs to the Special Issue Sustainability in Fashion Business Operations)
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Abstract

This article studies a supply chain composed of a manufacturer and two competing retailers. The manufacturer produces two substitutable products and offers respective service levels to customers who buy one of the two products. Each retailer can only order one kind of product from the manufacturer, and then sell them to the market at a certain sale price. The demands for two products are influenced not only by the service levels the manufacturer provides, but also the sales prices of the two products. Furthermore, we investigate the equilibrium behavior of members in the supply chain with the aid of the Stackelberg game, and discover a number of insights concerning some important parameters. Finally, Numerical analysis is presented to validate our theoretical results and compare channel performances. View Full-Text
Keywords: supply chain; service competition; substitutable products; Stackelberg game supply chain; service competition; substitutable products; Stackelberg game
This is an open access article distributed under the Creative Commons Attribution License (CC BY 3.0).

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Han, X.; Sun, X.; Zhou, Y. The Equilibrium Decisions in a Two-Echelon Supply Chain under Price and Service Competition. Sustainability 2014, 6, 4339-4354.

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