Price Decision-making In A Gray Market Supply Chain Considering Information Traceability For Gray Market Products

"Gray market" refers to the market generated by the sale of this brand of goods without the authorization of the manufacturer.In the era of economic globalization,modern logistics and e-commerce have achieved rapid development,which has led to the explosion of gray market scale.On the one hand,as manufacturers gain commercial profits indirectly without channel advertising fees,which leads to the lack of restraining power of manufacturers.On the other hand,the gray market intensifies the product competition between channels,and the subsequent maintenance problems such as no after-sales service and no warranty also seriously damage the brand effect of manufacturers.Therefore,how to deal with the gray market and how to trace the gray market products has become the biggest problem for manufacturers.Based on this background,this thesis takes product traceability technology as the starting point to analyze the pricing decision of gray market supply chain.Firstly,consider a gray market supply chain system consisting of a brand manufacturer and a retailer participating in gray market speculation.Construct a baseline model without traceability technology and an RFID traceability technology model,respectively,to compare the changes in the profits of each member of the supply chain after the manufacturer introduces information traceability technology.At the same time,in the context of the objective existence of the gray market,the pricing decision-making problem of the supply chain after introducing penalty strategies is analyzed,and the impact of introducing penalty strategies on equilibrium results in the RFID situation is studied.Finally,through numerical simulation verification and supplementation,the research shows that using traceless technology as the basic model,The probability of consumers purchasing high priced products and their preference coefficient for gray market products will directly or indirectly affect the sales status of the three types of products,thereby affecting the profits of manufacturers and retailers;Improving the probability of consumers purchasing high priced products has a dual effect.On the one hand,this increase in probability can suppress the expansion of the gray market,and on the other hand,it may also bring additional benefits to manufacturers and improve the efficiency of the gray market supply chain operation.At the same time,the introduction of RFID traceability technology can indeed enhance consumers’ willingness to purchase,but manufacturers benefit from the investment in traceability technology.In addition,the penalty strategy adopted by manufacturers depends on the consumer’s preference coefficient for the gray market and the size of technology costs.Secondly,based on the study of retailer speculation without traceability technology and the introduction of RFID traceability,a blockchain traceability technology model is constructed to further study and analyze the impact on manufacturer revenue and overall supply chain operational efficiency.And compare the three scenarios horizontally,and finally verify and supplement them through simulation examples.Research has shown that the introduction of different information traceability technologies will have a significant impact on the price and demand of authorized channel products.Adopting information tracing can effectively suppress the expansion of the gray market,but the inhibitory effects of different technologies vary;Retailers always benefit from the introduction of blockchain technology,which is due to the "free riding" phenomenon caused by not having to spend any costs,but the profit and loss situation of manufacturers is also closely related to the fixed costs of blockchain;In the case where the cost expenditures of the two traceability technologies are equal,manufacturers using blockchain technology can achieve higher profits compared to RFID technology.In addition,manufacturers’ use of penalty strategies is limited by different scenarios.In blockchain scenarios,retailers will only choose gray market speculation when and only when the valuation of products in the gray market and low price market is large and the penalty cost of blockchain is sufficient.Furthermore,by introducing case studies,this study analyzes the coping strategies of brand manufacturers in the face of distributors fleeing in real scenarios.The study shows that using information traceability technology can effectively suppress the expansion of the gray market,but consumers’ preference coefficient for the gray market has an impact on product prices and cluster returns.Therefore,while considering traceability technology,it is necessary to appropriately increase the punishment cost of retailers and safeguard their own rights and interests.This article takes the gray market traceability technology as the starting point to analyze the pricing decision-making problem of the supply chain,which not only fills the gap in the gray market supply chain from the perspective of traceability,but also improves the research on the impact of information traceability technology on consumer purchase intention.At the same time,the punishment strategies of manufacturers were analyzed to provide management insights for improving the operational efficiency of the gray market supply chain.