Author ORCID Identifier

http://orcid.org/0000-0003-0821-8787 : Guoqing Zhang

Document Type

Article

Publication Date

5-2018

Publication Title

Computers and Industrial Engineering

Volume

119

First Page

63

Last Page

75

DOI

10.1016/j.cie.2018.03.020

Keywords

Dual channel, Resalable returns, Reverse supply chains, Pricing, Stackelberg game, Nash game

Abstract

Many retailers are adopting a dual-channel retailing strategy (DCRS) in which products are offered through two channels: physical stores and online stores. Due to regulations or competitive measures, such a strategy allows customers who find a purchase unsatisfactory to obtain a full refund through a same-channel return or a cross-channel return. No papers have collectively studied the aforementioned types of customer returns in a dual-channel context. This paper studies optimal pricing policies for a centralized and decentralized dual-channel retailer (DCR) with same- and cross-channel returns. How dual-channel pricing behavior is impacted by customer preference and rates of customer returns is discussed. It is found, through sensitivity analysis, that when a channel with significant customer preference faces a high rate of returns, decentralized channels generate a greater system profit for retailers than coordinated channels that have a unified pricing strategy. A DCR with a Stackelberg scheme has the proclivity to be more profitable when under the leadership of a channel with a high rate of returns and significant customer preference.

Funding Reference Number

RGPIN-2014-03594

Comments

Recommend citation:

Radhi, M., & Zhang, G. (2018). Pricing policies for a dual-channel retailer with cross-channel returns. Computers & Industrial Engineering, 119, 63-75.

Creative Commons License

Creative Commons Attribution 4.0 License
This work is licensed under a Creative Commons Attribution 4.0 License.

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