Suppliers-competition and manufacturer’s product mix: the role of ingredient brand

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• 作者：Ting Zhang ; Qinglong Gou ; Liang Liang
• 关键词：Ingredient branding ; Brand awareness ; Product mix ; Pricing ; Supply chain ; Game theory ; 91A80
• 刊名：4OR: A Quarterly Journal of Operation Research
• 出版年：2015
• 出版时间：September 2015
• 年：2015
• 卷：13
• 期：3
• 页码：293-307
• 全文大小：536 KB
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• 作者单位：Ting Zhang (1)
  Qinglong Gou (1)
  Liang Liang (1)
  
  1. University of Science and Technology of China, Hefei, Anhui, China
  
• 刊物类别：Business and Economics
• 刊物主题：Economics
  Operation Research and Decision Theory
  Optimization
  Industrial and Production Engineering
  
• 出版者：Springer Berlin / Heidelberg
• ISSN：1614-2411

文摘

This paper proposes a pricing game among a manufacturer and two competing suppliers. One of the suppliers establishes an ingredient brand, which can enhance the valuations of the end products. The equilibrium is derived to investigate the impact of the ingredient brand awareness and the production costs on the suppliers-pricing competition, the manufacturer’s product mix and retail price(s), and profits. The result shows that the manufacturer may provide unique product or differentiated products, depending on the effectiveness of ingredient branding strategy. We distinguish two different monopolistic scenarios in supplier market and provide the condition for each supplier to survive. We find that the ingredient branding strategy mitigates the pricing competition between suppliers and benefits the manufacturer in a low production cost industry. Keywords Ingredient branding Brand awareness Product mix Pricing Supply chain Game theory