TY - GEN
T1 - The impact of used products on channel coordination and quality decision for warranted products
AU - Lo, Hui Chiung
AU - Yeh, Ruey Huei
AU - Kurniati, Nani
AU - Lin, Jung Jung
PY - 2013
Y1 - 2013
N2 - This paper studies a problem of channel coordination for durable products sold with a warranty. Offering warranty may promote the customer's satisfaction, but it also results in additional costs for manufacturers. The warranty cost depends on the quality of products. At the same time, cost-sharing contract is a negotiating mechanism to achieve channel coordination and increase the competitiveness of a supply chain. Hence, we try to introduce a warranty cost sharing policy which the warranty cost is shared out between manufacturers and retailers. In addition, many sales of a new product occur simultaneously with a trade-in of the used product to reduce purchasing cost and confirm to the sense of environmental protection. In other words, manufacturers and retailers of new products have to contend with the potential competition from a second-hand market. Therefore, taking account of used products, this paper employs a two-period game model to analyze the benefits of channel coordination and optimal pricing and quality decisions in a manufacture-retailer supply chain for new goods sold with warranty.
AB - This paper studies a problem of channel coordination for durable products sold with a warranty. Offering warranty may promote the customer's satisfaction, but it also results in additional costs for manufacturers. The warranty cost depends on the quality of products. At the same time, cost-sharing contract is a negotiating mechanism to achieve channel coordination and increase the competitiveness of a supply chain. Hence, we try to introduce a warranty cost sharing policy which the warranty cost is shared out between manufacturers and retailers. In addition, many sales of a new product occur simultaneously with a trade-in of the used product to reduce purchasing cost and confirm to the sense of environmental protection. In other words, manufacturers and retailers of new products have to contend with the potential competition from a second-hand market. Therefore, taking account of used products, this paper employs a two-period game model to analyze the benefits of channel coordination and optimal pricing and quality decisions in a manufacture-retailer supply chain for new goods sold with warranty.
KW - Channel coordination
KW - Cost sharing
KW - Durability
KW - Heterogeneous consumer
UR - http://www.scopus.com/inward/record.url?scp=84885590825&partnerID=8YFLogxK
M3 - Conference contribution
AN - SCOPUS:84885590825
SN - 9780976348696
T3 - Proceedings - 19th ISSAT International Conference on Reliability and Quality in Design, RQD 2013
SP - 131
EP - 135
BT - Proceedings - 19th ISSAT International Conference on Reliability and Quality in Design, RQD 2013
T2 - 19th ISSAT International Conference on Reliability and Quality in Design, RQD 2013
Y2 - 5 August 2013 through 7 August 2013
ER -