Download or read book Essays on Product Assortment Inventory and Pricing Decisions in Supply Chains written by Praneet Narayan Singh and published by . This book was released on 2007 with total page 163 pages. Available in PDF, EPUB and Kindle. Book excerpt: We conclude in the third essay by applying non-analytical approaches to examine the effect of some key factors on assortment planning. These include the customer preference structure, retail price dependent utility function, correlation of retailer demands and stock-out based substitution. The exposition and insights in this essay supplement and enrich our analytical approach in the first two essays.

Download or read book Essays on Retail Operations written by Tugce Vural and published by . This book was released on 2021 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Decision making spends valuable resources of a decision maker such as time, energy, and cognitive power. This dissertation focuses on the ripple effects of the customers' costly decision making process that a retailer should recognize in its operational decisions. In Chapter 2, a new choice model is presented to capture the customers' effort in their purchase decision. The optimal consideration set of customers, i.e., which options to collect information from, is characterized using a stylized model. We show that biases towards the options, stochastic payoffs, and the degree of difficulty in collecting and processing information are the primary determinants of the consideration set formation. By anticipating how customers make a choice, a retailer's optimal product assortment and price decision are provided. We further introduce the concept of fashion and show its influence both on the customers' and a retailer's decisions. Chapter 3 continues the discussion with the Home-Try-On retail model that intends to assist customers in finding what they value by sending a curated box of products to their homes. The retail model is analyzed by optimizing the assortment and price decisions to understand whether if it is optimal for a retailer to determine the box content for its customers. We show that it is not always profitable for a retailer to determine the box content. In some cases, the optimal decision maker of the box composition, i.e., customers or the retailer, can be the one who acquires and evaluates the information in a more costly manner. The chapter aims the attention on the retail operations that are not directly observable by customers, yet are affected by the costliness of purchase decisions. We specifically present the ways in which the inventory replenishment mechanism is shaped by helping customers in a Home-Try-On retail. Using insights from the interviews that we conducted with a Home-Try-On retailer, a unique version of a closed-loop supply chain is presented and simulated. The outputs of the simulation further point out the necessity of approaching the problems with a closed-loop supply chain lens due to the complexity of emerging operation models. These chapters suggest the importance of incorporating the value of customers' attention and new avenues that it opens in the Operations Management discipline.

Download or read book Dissertation Abstracts International written by and published by . This book was released on 2009 with total page 640 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Assortment Planning and Inventory Management for Substitutable Products written by Ying Cao (Ph. D.) and published by . This book was released on 2018 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation consists of three essays which study assortment planning and inventory management of substitutable products motivated by different practical problems. Chapter 2 considers the assortment planning problem for a retailer who faces customers that buy multiple differentiated products (n-pack) on a store visit. We develop two choice models: the probabilistic choice rule which captures the heterogeneous consumer population choice pattern and maximum choice rule which captures the homogeneous consumer population choice pattern. We find that, under probabilistic choice rule, the optimal assortment is such that it includes a certain number of the most and least popular products. In contrast, under maximum choice rule, the optimal assortment does not have a fixed structure except that it is guaranteed to include the most popular product. We develop an algorithm under maximum choice rule which is shown to have good performance. In addition, we derive the structure of optimal assortment under both choice rules when a retailer ignores key features of n-pack choice model including choice premium and basket shopping behavior. We also conduct a numerical study where we show that ignoring these key features can lead to significant profit loss for a retailer. Chapter 3 explores the assortment planning for a firm who faces a two-sided market. That is, the firm receives revenues from two distinct user groups: the customers, who pay for the products it sells and the advertisers who pay to advertise their brand to the customers. We obtain structural properties of the optimal assortment. We also consider the case where the firm is allowed to offer multiple products with the same attractiveness profile and price. In this case, we obtain conditions under which the optimal assortment is made out of distinct products. In addition, we show that ignoring the revenue from the customers or the advertisers, or focusing only on one segment when making product assortment decisions can lead to a significant revenue loss; specifically, we derive the theoretical bound on revenue loss in these situations. Chapter 4 studies the decision making of an inventory manager who needs to decide order quantities of multiple substitutable products in his store. As such, the decision maker typically checks the sales history of the products. When there is stock-out, the sales history provides inaccurate information because the lost sales are unobservable and the sales from substitution are indistinguishable from first-choice sales, which we refer to as the "doublecensoring effect". To study the impact of substitution rate and information amount on decision maker's performance, we design an experiment where subjects need to decide inventory levels for 2 substitutable products in consecutive 30 periods. The experimental data shows that subjects underestimate the demand for high demand product and overestimate the demand for low demand product. Moreover, the bias is worse when there is substitution in fully censored information treatment. Also, when subjects are provided with less information, they tend to order larger quantity in early periods in order to learn demand.

Download or read book Essays in Inventory Decisions Under Uncertainty written by Andrew Steven Manikas and published by . This book was released on 2008 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Uncertainty is a norm in business decisions. In this research, we focus on the inventory decisions for companies with uncertain customer demands. We first investigate forward buying strategies for single stage inventory decisions. The situation is common in commodity industry where prices often fluctuate significantly from one purchasing opportunity to the next and demands are random. We propose a combined heuristic to determine the optimal number of future periods a firm should purchase at each ordering opportunity in order to maximize total expected profit when there is uncertainty in future demand and future buying price. Second, we study the complexities of bundling of products in an Assemble-To-Order (ATO) environment. We outline a salvage manipulator mechanism that coordinates the decentralized supply chain. Third, we extend our salvage manipulator mechanism to a two stage supply chain with a long cumulative lead time. With significant lead times, the assumption that the suppliers all see the same demand distribution as the retailer cannot be used.

Download or read book Optimal Inventory and Pricing Decisions for Supply Chain Management written by Wen Chen and published by . This book was released on 2013 with total page 218 pages. Available in PDF, EPUB and Kindle. Book excerpt: The dissertation contains two major research projects. In the first project, we first study a multi-period inventory planning problem. In each period, the firm under consideration can source from two possibly unreliable suppliers for a price-dependent demand. Our analysis suggests that the optimal procurement policy is neither a simple reorder-point policy nor a complex one without any structure, as previous studies suggest. Instead, we prove the existence of a reorder point for each supplier. No order is placed to that supplier for any inventory level above the reorder point and a positive order is issued to that supplier for almost every inventory level below the reorder point. We characterize conditions under which the optimal policy reveals monotone response to changes in the inventory level. Furthermore, two special cases of our model are examined in detail to demonstrate how our analysis generalizes a number of well-known results in the literature. In the second project, we study a long-run inventory planning problem in which the retailer can replenish inventory and change price adjustment. We establish that it is optimal to change the price from low to high in each replenishment cycle, the optimal order-up-to level may decrease when the ordering cost increases, and fewer customers are served when the unit cost of procurement increases. Additionally, we provide efficient algorithms to compute the optimal stocking and pricing policies.

Download or read book Essays on Joint Operational and Marketing Decisions in Individual Firms and Supply Chains written by Ling Wang and published by . This book was released on 2007 with total page 336 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Multi product Supply Chains written by Shu Zhou and published by . This book was released on 2007 with total page 202 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays in Operations and Marketing written by Te Ke and published by . This book was released on 2015 with total page 120 pages. Available in PDF, EPUB and Kindle. Book excerpt: My thesis consists of three essays in the field of operations management and marketing. In the first essay, I study the problem of consumer search for information on multiple products. When a consumer considers purchasing a product in a product category, the consumer can gather information sequentially on several products. At each moment the consumer can choose which product to gather more information on, and whether to stop gathering information and purchase one of the products, or to exit market with no purchase. Given costly information gathering, consumers end up not gathering complete information on all the products, and need to make decisions under imperfect information. I solve for the optimal search, switch, and purchase or exit behavior in such a setting, which is characterized by an optimal consideration set and a purchase threshold structure. It is shown that a product is only considered for search or purchase if it has a sufficiently high expected utility. Given multiple products in the consumer's consideration set, the consumer only stops searching for information and purchases a product if the difference between the expected utilities of the top two products is greater than some threshold. Comparative statics show that negative information correlation among products widens the purchase threshold, and so does an increase in the number of the choices. Under my rational consumer model, I show that choice overload can occur when consumers search or evaluate multiple alternatives before making a purchase decision. I also find that it is optimal for sellers of multiple products to facilitate information search for low-valuation consumers, while obfuscate information for those with high valuations. In the second essay, I conduct an empirical study of peer effects of iPhone adoptions on social networks. I use a unique data set from a provincial capital city in China, in a span of over four years starting from iPhone's first introduction to mainland China. I construct a social network using six month's call transactions between iPhone adopters and all other users on a carrier's network. Strength of social ties is measured by duration of calls. Based on the network structure, I test whether an individual's adoption decision is influenced by his friends' adoptions. A fixed-effect model shows that, on average, a friend's adoption increases one's adoption probability in next month by 0.89%, and the marginal effect decreases in the size of his current neighboring adopters. To further control for potential time-varying correlated unobservables, I instrument adoptions of one's friends by their birthdays, based on the fact that consumers are more likely to adopt iPhones on birthdays. The IV estimation shows a slightly smaller peer effect at 0.75%. I also investigate how network structures modulate the magnitude of peer influence. My results show that peer effect is stronger when the influencer has more friends or has a stronger relationship with the influence. In the third essay, I study the problem of coordination of operations and marketing decisions for new product introductions. In the industry with radical technology push or rapidly changing customer preference, it is firms' common wisdom to introduce high-end product first, and follow by low-end product line extensions. A key decision in this "down-market stretch" strategy is the introduction time. High inventory cost is pervasive in such industries, but its impact has long been ignored during the presale planning stage. This essay takes a first step towards filling this gap. I propose an integrated inventory (supply) and diffusion (demand) framework, and analyze how inventory cost influences the introduction timing of product line extensions, considering substitution effect among successive generations. I show that under low inventory cost or frequent replenishment ordering policy, the optimal introduction time indeed follows the well-known "Now" or "Never" rule. However, sequential introduction becomes optimal as the inventory holding gets more substantial or the product life cycle gets shorter. The optimal introduction timing can increase or decrease with the inventory cost depending on the marketplace setting, requiring a careful analysis.

Download or read book Product Line Pricing in a Supply Chain written by Lingxiu Dong and published by . This book was released on 2015 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: A vertically integrated channel would prefer to coordinate the pricing of its products. In this paper, we investigate drivers of product line pricing decisions in a bilateral monopoly where a manufacturer produces and sells two substitutable or complementary products to a retailer. In a two-stage game, each firm commits credibly in the first stage to a pricing scheme within its own organization: product line pricing (PLP) or nonproduct line pricing (NPLP). In the second stage, depending on the relative balance of power in the supply chain, the firms engage in either a Nash or a leader-follower pricing game. We study the equilibrium of the two-stage game under a general symmetric demand function. With strategic interaction between firms, a firm may choose NPLP as the equilibrium pricing strategy. In particular, when the second stage is a leader-follower game, the price leader chooses PLP, and the follower may choose NPLP only if the inefficiency of using NPLP empowers the follower by increasing the demand sensitivity to the leader's margin. When the second stage is a vertical Nash game, whether NPLP occurs in equilibrium depends on the nature of coupling between demand interdependence and vertical strategic dependence: NPLP can be an equilibrium only if products are demand substitutes (complements) and vertical strategic dependencies are complementary (substitutable). We find that prisoner's dilemma exists in the first stage for both types of second-stage pricing games. In those cases, one firm may have the incentive to commit to a pricing scheme in the first stage prior to its channel partner and steer the supply chain away from prisoner's dilemma.

Download or read book Three Essays on Dynamic Production and Pricing Decisions for New Products written by Wenjing Shen and published by ProQuest. This book was released on 2000 with total page 161 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Perspectives in Operations Management written by Rakesh K. Sarin and published by Springer Science & Business Media. This book was released on 2012-12-06 with total page 490 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the fall of 1992 a conference honoring Elwood S. Buffa was held at the Anderson Graduate School of Management of the University of California, Los Angeles. This book is a collection of the work presented at that conference. The scholars who gathered to honor El are the prominent researchers in the field of Operations Management. Their collective work published in this book represents the richness of the field and provides the reader with valuable insights into its important issues and problems. While any grouping of the articles by these distinguished scholars will be arbitrary, I have organized the book in four sections. In the first section the articles dealing with the strategic issues in Operations Management are compiled. The articles deal with continuous improvement, quality, services, supply chain management, and creating value through operations. The articles that explore the interface of Operations Management with other functional areas, e.g. engineering and marketing, are grouped in the second section. The third section of the book contains articles that attempt to model some important planning problems that arise in the management of production and operations. Some of the papers in this section provide state of the art reviews of selected topic areas. Finally, the fourth section contains articles that deal with future directions for Operations Management. The authors offer several insights into the future evolution of the field. The book begins with the keynote address given by El Buffa at the start of the conference on November 2, 1991.

Download or read book Essays on Retail Product Assortment and Vertical Relationships written by Xinrong Zhu (Ph.D.) and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this dissertation, I study retail product assortments and how vertical relationships between manufacturers and retailers shape the retail landscape. The first chapter studies systematically the market share dispersion of national brands in 25 consumer packaged goods industries, and investigate the role of retailers in explaining the share dispersion. We first document stylized facts that the distribution of national top brand shares are asymmetric across retailers, even for retailers competing in the same geographic market, and the "share advantage" that a leading brand enjoys within a retailer is persistent across markets where the retailer is present and stable over time. We then specify and estimate a variance decomposition model to decompose the total variance in national brand shares and product assortments into a Brand * Retailer component and a Brand * Market component. We find that 50% to 60% of the total variance is accounted for by the Brand * Retailer component, while the Brand * Market component only explains about 10% to 20% of the total variance. Our results suggest that the large market share dispersion of national brands is caused by strong asymmetries in how these brands are presented in different retailers, even under similar market conditions. Finally we provide evidence that long-term vertical relationships between retailers and manufacturers is a key explanation for the strong asymmetries in national top brand shares across retailers and geographic regions. The second chapter takes the empirical evidence documented in the first chapter one step further, and studies a specific type of vertical arrangement---category captaincy contract. Category captaincy is a vertical arrangement whereby the retailer delegates pricing and assortment decisions of an entire category to one of the leading manufacturers within the category. These confidential contracts can lead to disproportionately higher market shares for the captain's products. The objective of the paper is to infer the existence of such contracts and to quantify their impacts on prices, market shares, and profits of manufacturers and retailers. I use the yogurt category as an empirical setting, in which the captain is either Dannon or Yoplait---the top two brands in the category by national market share. Using Nielsen scanner data, I first estimate a random-coefficient model of consumer demand. I use estimates of the brand-retailer specific shocks and a Bayesian inference model to classify retailers into one of the three categories: Dannon-captained retailers, Yoplait-captained retailers, or non-captained retailers. Conditional on the classified arrangements, I then apply conduct tests to infer that captains eliminate double markups from their own products, while the non-captain products still have double markups. The results from counterfactual experiments show that category captaincy arrangements increase market shares of the captain by about 50%, but they can also increase retailer profits and consumer welfare by eliminating double markups on the captain's products.

Download or read book Product Assortment and Pricing Decisions in a Competitive Environment written by Michaela Draganska and published by . This book was released on 2001 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Retail Product Assortment and Vertical Relationships written by Xinrong Zhu (Ph.D.) and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this dissertation, I study retail product assortments and how vertical relationships between manufacturers and retailers shape the retail landscape. The first chapter studies systematically the market share dispersion of national brands in 25 consumer packaged goods industries, and investigate the role of retailers in explaining the share dispersion. We first document stylized facts that the distribution of national top brand shares are asymmetric across retailers, even for retailers competing in the same geographic market, and the "share advantage" that a leading brand enjoys within a retailer is persistent across markets where the retailer is present and stable over time. We then specify and estimate a variance decomposition model to decompose the total variance in national brand shares and product assortments into a Brand * Retailer component and a Brand * Market component. We find that 50% to 60% of the total variance is accounted for by the Brand * Retailer component, while the Brand * Market component only explains about 10% to 20% of the total variance. Our results suggest that the large market share dispersion of national brands is caused by strong asymmetries in how these brands are presented in different retailers, even under similar market conditions. Finally we provide evidence that long-term vertical relationships between retailers and manufacturers is a key explanation for the strong asymmetries in national top brand shares across retailers and geographic regions. The second chapter takes the empirical evidence documented in the first chapter one step further, and studies a specific type of vertical arrangement---category captaincy contract. Category captaincy is a vertical arrangement whereby the retailer delegates pricing and assortment decisions of an entire category to one of the leading manufacturers within the category. These confidential contracts can lead to disproportionately higher market shares for the captain's products. The objective of the paper is to infer the existence of such contracts and to quantify their impacts on prices, market shares, and profits of manufacturers and retailers. I use the yogurt category as an empirical setting, in which the captain is either Dannon or Yoplait---the top two brands in the category by national market share. Using Nielsen scanner data, I first estimate a random-coefficient model of consumer demand. I use estimates of the brand-retailer specific shocks and a Bayesian inference model to classify retailers into one of the three categories: Dannon-captained retailers, Yoplait-captained retailers, or non-captained retailers. Conditional on the classified arrangements, I then apply conduct tests to infer that captains eliminate double markups from their own products, while the non-captain products still have double markups. The results from counterfactual experiments show that category captaincy arrangements increase market shares of the captain by about 50%, but they can also increase retailer profits and consumer welfare by eliminating double markups on the captain's products.

Download or read book Beyond Plain Vanilla written by Michaela Draganska and published by . This book was released on 2011 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper, we take a first step toward exploring empirically the product assortment strategies of oligopolistic firms. Our starting point is a discrete-choice demand model for differentiated products. We incorporate the demand model into an equilibrium supply model, in which firms compete by first choosing which products to offer and then by setting prices. We show how modeling joint product assortment and pricing decisions enriches standard product choice models by allowing insights into how demand characteristics affect firms' product offerings in a competitive environment. We furthermore demonstrate that incorporating endogenous product choice into demand models is essential for policy simulations (e.g., mergers) as it entails at times dramatically different welfare assessments than the common assumption that product assortments are exogenous.

Download or read book Essays on Operations marketing Strategy written by Aydın Alptekinoğlu and published by . This book was released on 2004 with total page 246 pages. Available in PDF, EPUB and Kindle. Book excerpt: