Journal ArticleDOI
Integrating inventory control and a price change in the presence of reference price effects: a two-period model
Alfred Taudes,Christian Rudloff +1 more
Reads0
Chats0
TLDR
This work proposes the use of an integrated pricing and inventory control model with a two-period linear demand model, in which demand also depends on the difference between a price-history-based reference price and the current price.Abstract:
Demand and procurement planning for consumer electronics products must cope with short life cycles, limited replenishment opportunities and a willingness to pay that is influenced by past prices and decreases over time. We therefore propose the use of an integrated pricing and inventory control model with a two-period linear demand model, in which demand also depends on the difference between a price-history-based reference price and the current price. For this model we prove that the optimal joint pricing/inventory policy for the replenishment opportunity after the first period is a base-stock list-price policy. That is, stock is either replenished up to a base-stock level and a list-price is charged, or it is not replenished and a discount is given that increases with the stock-level. Furthermore, we use real-world cell phone data to study the differences between an integrated policy and traditional sequential optimization, where prices are initially optimized based on the expected demand and ordering cost, and the resulting demand distribution is used to determine an optimal inventory policy. Finally, we discuss possible extensions of the model.read more
Citations
More filters
Journal ArticleDOI
Pricing and lot-sizing decisions for perishable goods when demand depends on selling price, reference price, product freshness, and displayed stocks
TL;DR: A joint pricing and lot-sizing model for retailers selling perishable products in which the demand depends on not only the selling price and reference price but also the product freshness linked to expiration date and displayed stock level is developed.
Posted Content
Supply chain management and advanced planning: basics, overview and challenges
TL;DR: This paper aims at extracting the essence ofSCM and advanced planning in the form of two conceptual frameworks: The house of SCM and the supply chain planning matrix.
Journal ArticleDOI
Price promotion with reference price effects in supply chain
TL;DR: In this paper, the problem of price promotion in a supply chain comprising one manufacturer and one retailer, who take into account the reference price effects of consumers, is analyzed as a manufacturer-lead Stackelberg game.
Journal ArticleDOI
Optimal retailer investments in green operations and preservation technology for deteriorating items
TL;DR: In this article, the impact of dynamic retailer investments in green operations while considering the reference price effect was examined, and the findings suggest that continuous investment in green operation and preservation technology can significantly improve the retailer's financial performance.
Journal ArticleDOI
Investors’ Risk Preference Characteristics Based on Different Reference Point
TL;DR: In this article, the authors defined prior losses and gains by selecting different reference point to study investors' time-varying risk preference, and the empirical evidence showed that investors' risk preference is time varying and is influenced by previous outcomes; the stock market as a whole exhibits house money effect; that is, prior gains can decrease investors’ risk aversion while prior losses increase their risk aversion.
References
More filters
Book
Supermodularity and Complementarity
TL;DR: In this article, the authors introduce the concept of lattices, supermodular functions, and optimal decision models for cooperative games and non-cooperative games, and present a review of the literature.
Journal ArticleDOI
Minimizing a Submodular Function on a Lattice
TL;DR: General conditions under which a collection of optimization problems, with the objective function and the constraint set depending on a parameter, has optimal solutions that are an isotone function of the parameter are given.
Journal ArticleDOI
Dynamic Pricing in the Presence of Inventory Considerations: Research Overview, Current Practices, and Future Directions
TL;DR: In this paper, a review of the literature and current practices in dynamic pricing is presented, where the focus is on dynamic (intertemporal) pricing in the presence of inventory considerations.
Journal ArticleDOI
An Empirical Pooling Approach for Estimating Marketing Mix Elasticities with PIMS Data
TL;DR: This article proposed an alternative maximum likelihood, latent-pooling method for simultaneously pooling, estimating, and testing linear regression models empirically, which enables the determination of a "fuzzy" pooling scheme, while directly estimating a set of marketing mix elasticities and intertemporal covariances for each pool of SBUs.
Journal ArticleDOI
A reference price model of brand choice for frequently purchased products.
TL;DR: The authors proposed a brand choice model that incorporates both reference and observed prices for frequently purchased products, which is composed of a probability-of-purchase component and a reference-price-formation component.