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Manufacturer Encroachment and Quality Investment Decisions in a Two‐period Supply Chain by Le Wang; Zhen He; Shuguang He; Yiwen Zhang is a Engineering article available to read on EtoBox.

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## Abstract With the development of Internet technology, many manufacturers encroach into the retail market by selling products directly to consumers, which is called manufacturer encroachment. In practice, the manufacturer may encroach in normal sales period, markdown period, or both periods in a two‐period supply chain. It is a challenging task for the firm manager to provide appropriate quality level under different channel structures. This research originally studies manufacturer encroachment with endogenous quality investment decision in a two‐period supply chain considering that consumers' valuation of products depreciates over time. Using a game‐theoretic framework, this work explores four channel strategies of the manufacturer and discusses equilibrium decisions and profits. The analysis generates several insights. First, the manufacturer should promote quality investment if encroachment occurs when the direct selling is efficient. Second, regardless of which period and scenario, encroachment may increase wholesale price when the direct selling cost is smaller than a threshold. Third, results show the effect of encroachment time on price could be classified into quality inv

Who reads Manufacturer Encroachment and Quality Investment Decisions in a Two‐period Supply Chain?

Author

Le Wang; Zhen He; Shuguang He; Yiwen Zhang

Publisher

Wiley

Published

2023

Language

EN

Field

Engineering (Physical Sciences)