Complexity Analysis of Pricing in a Multichannel Supply Chain with Spillovers from Online to Offline Sales

Abstract EN

In recent years, many manufacturers have been selling their products to online consumers through e-tailers by adopting reselling mode and agency selling mode simultaneously.

The sales from the online channels inevitably incur spillover effect to the traditional offline channels.

This paper develops a dynamic pricing game model on the basis of a long-term gradient adjustment mechanism for a multichannel supply chain that consists of a manufacturer and an e-tailer and focuses on examining the impacts of spillover effect, agency fee, and adjustment speed on the stability and complexity of the dynamic game system.

The results show that both a greater spillover effect and a higher agency fee can make the dynamic game system more stable, and a higher adjustment speed can destabilize the dynamic game system through period doubling bifurcation.

Furthermore, it is interesting to find that the destabilization of the game system benefits the e-tailer and the supply chain while having little influence on the manufacturer, and thus the dynamic adjustment strategy may improve the supply chain efficiency.