Product variety and pricing issues in supply chain management

This dissertation consists of three main chapters, each of which deals with issues of product variety and/or pricing in supply chains. In all three chapters, we consider a supply chain with a single retailer and a single manufacturer.; In Chapter 1 we study a problem where the retailer decides what assortment of products to offer to the end customers, given a set of products supplied by the manufacturer. The prices for the items in the assortment are fixed. Decentralized ownership of the retailer and the manufacturer causes a discrepancy between the assortment of products offered by the retailer (retailer-optimal assortment) and the assortment that maximizes total supply chain profits (supply-chain-optimal assortment). We investigate a contract that involves a per-product fee paid by the manufacturer to the retailer. We show that this contract will induce the retailer to offer the supply-chain-optimal assortment while making both parties better off.; In Chapter 2 we focus on the retailer's inventory and pricing decisions for a given assortment. The products in the assortment compete with each other for customer demand. We first establish structural results on the retailer's inventory and pricing problem. We then discuss a buyback contract where the buyback price is a function of the retail price. We illustrate how this contract may induce the retailer to choose prices and inventory levels that are optimal for the entire supply chain.; In Chapter 3 we study a problem where the supply chain may use either retailer rebates (paid by the manufacturer to the retailer based on the sales performance of the retailer) or consumer rebates (paid by the manufacturer to the consumer upon the consumer's purchase of the manufacturer's product). The consumer demand is stochastic and depends on the retail price paid by the consumer. Under each rebate policy, the retailer chooses the retail price and the inventory level whereas the manufacturer determines the magnitude of the rebate. We analyze the effect of each rebate policy on the profits of the retailer, the manufacturer and the supply chain. We extend some of our results to a case where both rebates are used simultaneously.