Analysing consumer RP in a dual-channel supply chain with a risk-averse retailer

Jiang, Yushan, Li, Bo and Song, Dongping (2017) Analysing consumer RP in a dual-channel supply chain with a risk-averse retailer. EUROPEAN JOURNAL OF INDUSTRIAL ENGINEERING, 11 (3). pp. 271-302.

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Abstract

This paper investigates a dual-channel supply chain consisting of a risk-neutral manufacturer and a risk-averse retailer. The manufacturer offers a consumer RP in the online channel, in which consumers face valuation uncertainty. We use conditional value-at-risk (CVaR) criterion to evaluate the risk-averse behaviour of the retailer. We examine how consumer RP and risk-averse behaviour influence the equilibrium solutions and supply chain agents' performance. It is shown that the manufacturer's optimal RP is related to consumer types. If the consumer has a moderate valuation of the product, the optimal RP depending on the retailer's risk-averse level. We observe a counter-intuitive phenomenon; the retailer's expected utility may increase under the double pressure of manufacturer encroachment and better returns service. Furthermore, a buyback revenue-sharing contract is offered to coordinate the dual-channel supply chain when the refund is endogenous. Finally, we explore several extensions. [Received 25 July 2015; Revised 27 October 2016; Accepted 13 November 2016]

Item Type:	Article
Uncontrolled Keywords:	supply chain management, dual-channel supply chain, manufacturer encroachment, demand uncertainty, valuation uncertainty, consumer returns, risk averse, conditional value-at-risk, CVaR, game theory, Stackelberg
Depositing User:	Symplectic Admin
Date Deposited:	03 Mar 2017 11:54
Last Modified:	19 Jan 2023 07:14
DOI:	10.1504/EJIE.2017.084877
Related URLs:	Author Publisher
URI:	https://livrepository.liverpool.ac.uk/id/eprint/3006198