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2014 The Strategy of New Product Introduction in Durable Goods with Secondary Market: Application of the Optimization Method to Supply Chain Problem
Pei Zhao, Zhongkai Xiong
J. Appl. Math. 2014: 1-10 (2014). DOI: 10.1155/2014/543092

Abstract

The aim of this paper is to address how the secondary market affects the strategy of the manufacturer’s new product introduction by using the optimization method. To do so, we develop a two-period model in which a monopolistic manufacturer sells its new durable products directly to end consumers in both periods, while an entrant operates a reverse channel selling used products in the secondary market. We assume that the manufacturer launches a higher quality product in the second period for the technological innovation. We find that the secondary market can actually increase the manufacturer’s profitability and drives the new product introduction in the second period. We also derive the effect of the durability and the degree of quality improvement on the pricing of supply chain partners.

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Pei Zhao. Zhongkai Xiong. "The Strategy of New Product Introduction in Durable Goods with Secondary Market: Application of the Optimization Method to Supply Chain Problem." J. Appl. Math. 2014 1 - 10, 2014. https://doi.org/10.1155/2014/543092

Information

Published: 2014
First available in Project Euclid: 2 March 2015

zbMATH: 07010678
MathSciNet: MR3182375
Digital Object Identifier: 10.1155/2014/543092

Rights: Copyright © 2014 Hindawi

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