A Game Theoretic Approach to Coordination of Pricing Decisions in the Supply Chain, Including Two Types of Primary and Processed Products

Authors

https://doi.org/10.48314/apem.v2i2.31

Abstract

Complementary activities such as packaging for products such as saffron significantly impact attracting more customers. This paper investigates the pricing problem in a Supply Chain (SC), including primary and processed products, in a competitive space using game theory. According to the results, the increase in complementary activities, to a certain extent, causes a decrease in profitability.

Keywords:

Supply chain, Primary product, Processed product, Pricing, Game theory, Intermediary

References

  1. [1] Zhao, J., Liu, W., & Wei, J. (2013). Competition under manufacturer service and price in fuzzy environments. Knowledge-based systems, 50, 121–133. https://doi.org/10.1016/j.knosys.2013.06.003
  2. [2] Xiao, T., & Xu, T. (2013). Coordinating price and service level decisions for a supply chain with deteriorating item under vendor managed inventory. International journal of production economics, 145(2), 743–752. https://doi.org/10.1016/j.ijpe.2013.06.004
  3. [3] Hsieh, C. C., Chang, Y. L., & Wu, C. H. (2014). Competitive pricing and ordering decisions in a multiple-channel supply chain. International journal of production economics, 154, 156–165. https://doi.org/10.1016/j.ijpe.2014.04.024
  4. [4] Zhao, J., Wei, J., & Li, Y. (2014). Pricing decisions for substitutable products in a two-echelon supply chain with firms׳ different channel powers. International journal of production economics, 153, 243–252. https://doi.org/10.1016/j.ijpe.2014.03.005
  5. [5] Zhao, J., & Wang, L. (2015). Pricing and retail service decisions in fuzzy uncertainty environments. Applied mathematics and computation, 250, 580–592. https://doi.org/10.1016/j.amc.2014.11.005
  6. [6] Zhang, J., Nault, B. R., Yang, W., & Tu, Y. (2012). Dynamic price quotation in a responsive supply chain for one-of-a-kind production. International journal of production economics, 139(1), 275–287. https://doi.org/10.1016/j.ijpe.2012.05.011
  7. [7] Şen, A. (2013). A comparison of fixed and dynamic pricing policies in revenue management. Omega, 41(3), 586–597. https://doi.org/10.1016/j.omega.2012.08.001
  8. [8] Qiang, Q., Ke, K., Anderson, T., & Dong, J. (2013). The closed-loop supply chain network with competition, distribution channel investment, and uncertainties. Omega, 41(2), 186–194. https://doi.org/10.1016/j.omega.2011.08.011
  9. [9] Zhao, Y., Yang, L., Cheng, T. C. E., Ma, L., & Shao, X. (2013). A value-based approach to option pricing: The case of supply chain options. International journal of production economics, 143(1), 171–177. https://doi.org/10.1016/j.ijpe.2013.01.004
  10. [10] Jia, J., & Zhang, J. (2013). Dynamic ordering and pricing strategies in a two-tier multi-generation durable goods supply chain. International journal of production economics, 144(1), 135–142. https://doi.org/10.1016/j.ijpe.2013.01.029
  11. [11] Wei, Y., Hu, Q., & Xu, C. (2013). Ordering, pricing and allocation in a service supply chain. International journal of production economics, 144(2), 590–598. https://doi.org/10.1016/j.ijpe.2013.04.022
  12. [12] Wang, J., Zhou, Z., & Yu, M. (2019). Pricing models in a sustainable supply chain with capacity constraint. Journal of cleaner production, 222, 57–76. https://doi.org/10.1016/j.jclepro.2019.01.319
  13. [13] Parsaeifar, S., Bozorgi-Amiri, A., Naimi-Sadigh, A., & Sangari, M. S. (2019). A game theoretical for coordination of pricing, recycling, and green product decisions in the supply chain. Journal of cleaner production, 226, 37–49. https://doi.org/10.1016/j.jclepro.2019.03.343
  14. [14] Seyedhosseini, S. M., Hosseini-Motlagh, S.-M., Johari, M., & Jazinaninejad, M. (2019). Social price-sensitivity of demand for competitive supply chain coordination. Computers & industrial engineering, 135, 1103–1126. https://doi.org/10.1016/j.cie.2019.05.019
  15. [15] Assarzadegan, P., & Rasti-Barzoki, M. (2020). A game theoretic approach for pricing under a return policy and a money back guarantee in a closed loop supply chain. International journal of production economics, 222, 107486. https://doi.org/10.1016/j.ijpe.2019.09.007
  16. [16] Malekian, Y., & Rasti-Barzoki, M. (2019). A game theoretic approach to coordinate price promotion and advertising policies with reference price effects in a two-echelon supply chain. Journal of retailing and consumer services, 51, 114–128. https://doi.org/10.1016/j.jretconser.2019.05.028
  17. [17] Jabarzare, N., & Rasti-Barzoki, M. (2020). A game theoretic approach for pricing and determining quality level through coordination contracts in a dual-channel supply chain including manufacturer and packaging company. International journal of production economics, 221, 107480. https://doi.org/10.1016/j.ijpe.2019.09.001
  18. [18] Mahmoodi, A. (2020). Stackelberg-Nash equilibrium of pricing and inventory decisions in duopoly supply chains using a nested evolutionary algorithm. Applied soft computing, 86, 105922. https://doi.org/10.1016/j.asoc.2019.105922
  19. [19] Liu, Y., Li, J., Ren, W., & Forrest, J. Y.-L. (2020). Differentiated products pricing with consumer network acceptance in a dual-channel supply chain. Electronic commerce research and applications, 39, 100915. https://doi.org/10.1016/j.elerap.2019.100915
  20. [20] Agrawal, A. K., & Yadav, S. (2020). Price and profit structuring for single manufacturer multi-buyer integrated inventory supply chain under price-sensitive demand condition. Computers & industrial engineering, 139, 106208. https://doi.org/10.1016/j.cie.2019.106208
  21. [21] Hsieh, C. C., & Wu, C. H. (2009). Coordinated decisions for substitutable products in a common retailer supply chain. European journal of operational research, 196(1), 273–288. https://doi.org/10.1016/j.ejor.2008.02.019
  22. [22] Chen, Y. C., Fang, S. C., & Wen, U. P. (2013). Pricing policies for substitutable products in a supply chain with Internet and traditional channels. European journal of operational research, 224(3), 542–551. https://doi.org/10.1016/j.ejor.2012.09.003
  23. [23] Yao, D. Q., & Liu, J. J. (2005). Competitive pricing of mixed retail and e-tail distribution channels. Omega, 33(3), 235–247. https://doi.org/10.1016/j.omega.2004.04.007
  24. [24] Yao, D. Q., Yue, X., & Liu, J. (2008). Vertical cost information sharing in a supply chain with value-adding retailers. Omega, 36(5), 838–851. https://doi.org/10.1016/j.omega.2006.04.003
  25. [25] Cachon, G. P., & Netessine, S. (2006). Game theory in supply chain analysis. Models, methods, and applications for innovative decision making, 200–233. https://doi.org/10.1287/educ.1063.0023
  26. [26] Kurata, H., Yao, D. Q., & Liu, J. J. (2007). Pricing policies under direct vs. Indirect channel competition and national vs. store brand competition. European journal of operational research, 180(1), 262–281. https://doi.org/10.1016/j.ejor.2006.04.002

Downloads

Published

2025-04-28

Issue

Vol. 2 No. 2 (2025): Annals of Process Engineering and Management

Section

Articles

How to Cite

A Game Theoretic Approach to Coordination of Pricing Decisions in the Supply Chain, Including Two Types of Primary and Processed Products. (2025). Annals of Process Engineering and Management, 2(2), 76-90. https://doi.org/10.48314/apem.v2i2.31

Similar Articles

You may also start an advanced similarity search for this article.