| As the livings of Chinese people continue to improve,consumer demand has become more diverse and personalized.The decline in demand for traditional products and the marginal profit reduction caused by fierce competition in the manufacturing industry have led more and more manufacturing companies to start a strategic transformation from providing products to providing solutions.They started to pay more attention to a new business model: product aftermarket services.Product aftermarket service refers to the service that consumers need in the subsequent use of purchased goods.It relies on and complements the durable goods in the product market,involving parts replacement,upgrade,maintenance,technical support,consulting,training,financing and so on.Taking the automotive aftermarket as an example,the size of China’s automotive aftermarket in 2018 is about 1.2 trillion yuan,and with the increasing ownership and average age of the car,the aftermarket service will continue to grow in years.Product aftermarket services enable manufacturing companies to extend the value chain into the service sector.Therefore,the manufacturing enterprises that enter the product aftermarket service need to take into account both the profit of the product market and the profit of the service aftermarket,which is reflected by the lock-in effect and the customer base effect,posing a new challenge for the business operation decisions of the enterpriseMost of the existing literature research on product aftermarket service and service outsourcing has explored the reasons for the formation,the economic essence,and the impact on society and enterprises of product aftermarket and service outsourcing in the form of qualitative research or case studies.There are also literatures that combine supply chain management,asymmetric information and other business operations to quantify the manufacturing operations strategy of manufacturing companies.However,their research did not consider the link between products and services in aftermarket service,nor did they consider the impact of third-party service providers’ participation on supply chain structure and information transfer mechanisms.This paper takes the characteristics of aftermarket service as an entry point and establishes an aftermarket service supply chain model consisting of one manufacturer,one third-party service provider and one retailer.Considering the outsourcing decision-making to third-party service providers,the asymmetry of demand information in the supply chain we analyze the choice of sales model,the channel selection,and the impact of private information on the supply chain.The specific research is as follows:Firstly,to study the sales model in the product service aftermarket,a vertical product-service supply chain consisting of single manufacturer and single retailer is constructed,by which we consider the independent sales model of products and services and the bundled sales model of products and services.The decision-making and profit of members in the supply chain under the two sales models are studied.By comparing the performance of the supply chain and the welfare of consumers under different models,the problem of the selection of the sales model of the manufacturer is explored.The results show that the profit of supply chain members decrease with the increase of consumer product price sensitivity coefficient,consumer service price sensitivity coefficient and manufacturer’s service cost coefficient,and with the increase of consumer service level sensitivity coefficient and potential market size.The sensitivities of the profit of members of the supply chain are different for each parameter.When the market size is small,one should choose bundled pricing,otherwise independent pricing.When consumers are sensitive to service levels,one should choose bundle pricing,otherwise independent pricing.When the cost of providing the service is low,one should choose bundled pricing,otherwise independent pricing.In order to further explore the relationship between market parameters and compare the two sales models,this paper establishes a simple consumer utility model.Through the utility model,it is found that the consumer’s sensitivity coefficient to the product and service bundled price is greater than the sensitivity coefficient of the product price;the sensitivity coefficient of the consumer to product price is greater than the sensitivity coefficient of the consumer to service price;the sensitivity coefficient to the service level is greater under independent pricing mode.Based on the above relationship,we find that the price sensitivity coefficient of the consumer under the independent pricing of the manufacturer,the price sensitivity coefficient of the consumer to the service under the independent pricing mode and the price sensitivity of the product and service combo of the consumer under the bundled mode are close,the manufacturer should choose bundled pricing to achieve Pareto improvement.Secondly,this paper adds the emergence of third-party service providers to the supply chain model,and analyzes the impact of the existence of third-party service providers on supply chain efficiency.Under the assumption of bundled pricing,this paper establishes a networked supply chain model consisting of single manufacturer,single third-party service provider and single retailer.We discuss variable license fee and fixed license fee for the manufacturer’s profit model in the service aftermarket respectively.The study find that the market supply under fixed license fee and the profits of both seller and manufacturer will increase,but the profit of the service provider is only its reserved profit;the profit of the manufacturer and the retailer and the market supply of products are positively related to and potential market size and consumer’s sensitivity coefficient of the service,and is negatively related to the service cost coefficient and the consumer’s sensitivity coefficient to the price;the service level determined by the manufacturer is inversely proportional to the service cost coefficient.By comparing the equilibrium solutions of the vertical channel and the networked channel,we find that although the supply chain members cannot coordinate the decisions of supply chain members,the manufacturer should choose the networked structure as long as the cost coefficient of the third party service provider provides services is lower enough.Then,this paper studies the problem of asymmetric information in vertical channel.Firstly,the impacts of asymmetric information on supply chain member decisionmaking,supply chain member profits and consumer welfare are studied by adding retailer’s private product demand information to the model.The study find that the retailer has an incentive to report a price sensitivity coefficient higher than what it actually is to increase their profits.When the retailer observes low price sensitivity of consumers to products and services,the manufacturer will provide lower service level to reduce costs,and the retailer will lower the bundled prices of products and services to increase market supply.When the retailer observes high price sensitivity of consumers to products and services,the manufacturer will provide a higher service level,making the market supply reduced.In addition,when the retailer has private information,the manufacturer’s profit is reduced.The profit of the retailer and the change in consumer welfare depend on the price sensitivity of consumer to products and services.When the price sensitivity of consumer to products and services is low,private information increases the profitability of the retailer and consumer welfare;when the price sensitivity of consumer to products and services is high,private information makes the retailer’s profit and consumer welfare reduced.Then,this paper designs a menu contract to eliminate the influence of asymmetric information.The specific parameters of the contract are given.We prove that the manufacturer can improve its profit by eliminating asymmetric information.Finally,this paper studies the private service demand information obtained by third-party service providers in the network channel due to their proximity to the service aftermarket.Private information from third-party service providers in the midstream of the supply chain will affect the supply chain in both the forward direction and reverse direction.This paper first studies the impact of the third-party service provider’s private service demand information on the supply chain,and finds that the third-party service provider has the incentive to report a price-sensitive coefficient that is lower than what it is to the manufacturer and the retailer to improve its own profit.We then discuss the signaling game between the third-party service provider and the retailer given the manufacturer’s decision.This paper proves that the separating equilibrium does not exist,and then gives the conditions for the existence of the pooling equilibriums.Next,this paper uses the concept of Lexicographically Maximum Sequential Equilibrium(LMSE)to screen the equilibriums.Under the retailer’s LMSE belief,this paper uses the numerical experiment method to draw the profits of the supply chain members under different market signals and the expected profit of the supply chain members,finding that when the third-party service provider in the supply chain owns asymmetric information,the profit of third-party service provider is always reduced,but the retailer’s situation depends on the retailer’s forecast of demand.When the bias of the forecast is large,the retailer’s profit and the performance of the supply chain rises,meaning the signal transmission mechanism between the third-party service provider and the retailer alleviates the double marginalization effect in the supply chain.Based on the above results,this paper presents an algorithm for solving the manufacturer’s decision.Finally,this paper examines the effect of the menu contract that the manufacturer uses to eliminate the effect of asymmetric information.Through the revelation principle,the optimization problem that the menu contract should satisfy under asymmetric demand is constructed.We propose a heuristic algorithm to solve the upper and lower bounds of the manufacturer’s profit under the menu contract.Through numerical simulation,we compare the profit when the manufacturer uses the menu contract and the wholesale price contract,and find that when the demand information bias between the third-party service provider and the retailer in the supply chain is small,the manufacturer should choose the menu contract to eliminate the asymmetric information.Otherwise the manufacturer should choose wholesale price contract to eliminate the double marginalization effect.The innovations of this paper are as follow.First,we establish the market demand function of product and service according to relationship between the primary market and service aftermarket in product service system.Then we build a vertical productservice supply chain model consists of one manufacturer and one retailer.This article examines two sales models: independently selling product and service,and bundling product and service.After obtaining the profit of supply chain members under equilibrium,this paper compares corporate profits and consumer welfare under two sales models.Second,this paper introduces third-party service providers into the vertical supply chain,forms a networked supply chain.We build a networked productservice supply chain model consisting of one manufacturer,one third-party service provider and one retailer.This article examines the manufacturer’s two models of license fee: variable license fee and fixed license fee.According to the profit of supply chain members under equilibrium,this paper compares the corporate profits under the two authorization models,based on which the efficiency of the supply chain and consumer welfare under the networked channel and the vertical channel are compared.Third,this paper considers the asymmetry information that may appear in the vertical channel of the product-service supply chain.Assuming that the retailer has private product demand information,this paper studies the impact of asymmetric information on supply chain member profit and supply chain efficiency,and uses the revelation principle to discuss the mechanism design problem of the manufacturer using menu contract to eliminate asymmetric demand information.Finally,this paper considers the asymmetric information that may appear in the networked channel of the product-service supply chain.Assuming that the third-party service provider has private service demand information,this paper first discusses the impact of signal delivery mechanisms between the third-party service provider and the retailer on supply chain efficiency.We then discuss the profit of the supply chain after the manufacturer adopts the menu contract to eliminate asymmetric information,providing guidance on when the manufacturer should adopt the menu contract.In short,this paper studies the operational decision-making issues in the productservice supply chain including sales model,channel model selection and information asymmetry.Key managerial insights include: When the price sensitivity of consumers to products under independent pricing,the price sensitivity of consumers to services under independent pricing and the price sensitivity of consumers to product and service combo under bundled pricing are close,the manufacturer should choose the bundled pricing model;as long as the cost coefficient of the third-party service provider provides services is lower,the manufacturer should introduce the service outsourcing and select the networked channel;the manufacturer under the vertical channel can enhance it profit by eliminating asymmetric information;eliminating asymmetric information under the networked channel may affect the mitigation effect of the signal transfer mechanism between the third-party service provider and the retailer on double marginalization effect,thus affecting the supply chain’s efficiency and its own own profit.However,the research in this paper only considers the deterministic demand function,asymmetric demand information and traditional distribution channels,ignoring the risk attitudes of the supply chain members and other distribution channel of the manufacturer in the service aftermarket.Therefore,future research may discuss these limitations and analyzes the supply chain management decision-making issues of aftermarket service. |
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