Study On The Promotion Problems Of Deteriorating Goods

For retailer, the emphasis of making sales plan is the selling strategy of deteriorating items. In the real world, when retailer sales deteriorating items, they usually adopt price discount strategy or quantity discount policy in case of those deteriorating items would effect on sales profit.While previous strategy about price discount strategy and quantity discount policy reflect that retailers often fall into a passive condition, they can not change their order strategy according to the demand of customers flexibly. Besides, researches on temporary price discount mainly start from the discount price decision and then the maximum of retailer profit, none of relevant literatures consider two variables, which are discount price and discount starting time.Though analysis and summarize previous research, this paper contains following works:1.Firstly, introduce relevant concepts of inventory and inventory management, function of inventory management, factors and mode of inventory management. Secondly, this paper also introduce the source of topic selection, research background, research purpose and meaning. Last, the contents of this paper.2.This paper connects with actual situation, studied under different demand, in order not to effect on sales profit, when retailers sale, how to make temporary price discount strategy. That is, during sale cycle of deteriorating items, retailers should make decision on when should start price discount and how much the discount will be in order to make their profit maximum,3.Through the establishment and solving of the model, we can obtain the optimal discount and the perfect time to conduct the discount with the aim of profit maximum, explanation is given theoretically. Then the analysis of actual examples shows that after retailers adopt the temporary price discount strategy, their profit increase greatly. This paper also analysis the influence of different deterioration rate, price sensitivity coefficient or start time of deterioration to retailer's order quality, the result comes out to be equal to the previous expectation.The innovation point of the paper abandons previous research which only include price discount associate to the suppler, and starting from the point of price discount which is meeting the need of customers, decision variables is not the original discount price in the past research, discount price and discount start time are considered simultaneously. The results of this paper not only enrich the content of promotion theory, but also supply theoretical bases for retailer in real decision making process.