Research On Ordering And Pricing Policy For Two Substitutable Products

The subject of the thesis originates from Project 70471045: Supply Coordination and Quantity Discount Research Based on Stochastic Demand and Asymmetric Information, which is supported by National Natural Science Foundation of China, and from Project 20060359007: Specialized Research Fund for the Doctoral Program of Higher Education.Supply substitutability offers the consumers more choices in case of stock-outs, thus minimizing the loss on the part of the retailer and improving the consumer's satisfaction. Therefore, in predicting the demand of products and deciding the optimal inventory policy, we must take into account the substitutability of similar products. In recent years, researches on the inventory model of the substitutable products have aroused the interests of a lot of domestic and foreign scholars and have gradually become a hot spot in the respect of supply chain stock management. The majority of the literature is based on the classical newsboy model and its expansion. This thesis follows the basic way of thinking and extends it in the following respects:(1) Based on the hypothesis that the supply chain has only one retailer who sells two substitutable products, and that the substitution rate and cost are both fixed, we have derived the retailer's optimal ordering policy in the face of stochastic demand.(2) Based on the hypothesis that the supply chain has only one retailer who sells two one-way substitutable products, but that the substitution price is taken as a decision variable and the substitution rate as its function, we have proved the existence of optimal substitution price, and formulated the necessary conditions for the retailer's optimal ordering quantity and substitution price.(3) Based on the hypothesis that the supply chain has two competing suppliers and one retailer that sells both suppliers' products, and that the two kinds of products supplied by them respectively are substitutable, we have proved that, whether the demand is fixed or stochastic, there exists the Nash equilibrium for three non-cooperative games between the two suppliers and the retailer, i.e., two Stackleberg and one Nash games.