Joint Pricing And Order Fulfillment In A Dual-channel Supply Chain Under Demand Uncertainty

Driven by enormous advances in Internet,e-commerce and logistics,the retail industry has been through a quick development in the online retail over the past two decades.And market demand is facing frequent fluctuations due to the improvement of living standard and the diversification of customer choice.In this regard,how to deal with the impact of demand uncertainty on performance is the hardbone in dual-channel supply chain management.Besides,to minimize operating and inventory costs,retailers in a dual-channel supply chain expect to choose proper order fulfillment strategies such as batch ordering or drop-shipping.So it is essential to take the order fulfillment modes into consideration in the theoretical research and practical application of dual-channel supply chain management.This thesis is to study the joint pricing and order fulfillment in a dual-channel supply chain,and constructs the model based on the "max-min" robust optimization theory which is universally accepted by the academics.Meanwhile,considering the interaction of pricing,ordering decisions among members in a dual-channel channel,we formulate the robust pricing and ordering model according to the relevant theoretical of game theory.And study the impact of market power structure and demand uncertainty on pricing,ordering and order fulfillment strategies.Mainly in the following areas:(1)Distribution free approach in uncertain demand situations.This thesis considers the impact of the uncertainty of market demand on the pricing and ordering decisions of dual-channel supply chain.During specific modeling,it is assumed that the market demand distribution is unknown,but the partial information of the stochastic demand such as mean and variance is known to the decision maker.Robust pricing and ordering modeling is based on the "max-min" criteria for seeking the optimal expected profit in the worst cases.And a comparison between the stochastic programming and distribution free approach is given to show the effectiveness of the robust optimization.(2)Based on research above,we model a robust pricing and ordering model of dual-channel supply chain with the e-tailer and traditional retailer making price decisions simultaneously.Firstly,according to the methods of game theory,backward induction is used to study the robust pricing and ordering decisions of supply chain members under different dual-channel supply chain structure.Secondly,to evaluate the effectiveness of the distribution free approach,stochastic programming approach where demand obeys a specific distribution is given.Furthermore,numerical experiments are performed to illustrate the effectiveness and practicality of the proposed models and the impacts of market parameters.(3)On the basis of research(2),we further consider channel dominant advantage in the dual-channel supply chain,where the e-tailer also adopts two order fulfillment polices:batch ordering or drop-shipping.By sequential analysis of supply chain members’ pricing and ordering decisions,we formulate the models and investage the numerical experiments with sensitivity analysis and order fulfillment strategies.And some intersesting managerial insights are also provided.In this thesis,we discuss the problem of joint pricing and ordering fulfillment in a dual-channel supply chain to study the mechanism of market power structure and demand uncertainty on pricing and ordering fulfillment and obtain effective strategies to reduce the loss of uncertainty demand.And the result will support members in a dual-channel for making efficient pricing and ordering fulfillment strategies facing with frequent fluctuation of market demand.