Capacity Rationing of Product in Advance Selling

DOI

10.2991/assehr.k.200428.061How to use a DOI?

Keywords

capacity rationing, advance selling, strategic consumer behavior

Abstract

We consider a retailer who sells a single product to strategic consumers sensitive to price over two periods: advance and spot. The retailer’s decisions include whether to offer the product and, if so, the prices in both periods, and whether to ration capacity in the advance period. This article takes the retailer’s profit maximization as the goal, and focusing on how the retailer determines the capacity rationing strategy when selling products to strategic consumers, and backward induction is used to derive the seller’s decisions in equilibrium. Research indicates that the retailer’s optimal rationing policy is unrelated with the cost of product, and is mainly determined by the retailer’s capacity and the number of consumers who arrive in advance.

Copyright

© 2020, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - Yan Zhao
AU  - Taofeng Ye
PY  - 2020
DA  - 2020/05/01
TI  - Capacity Rationing of Product in Advance Selling
BT  - Proceedings of the 6th International Conference on Humanities and Social Science Research (ICHSSR 2020)
PB  - Atlantis Press
SP  - 285
EP  - 288
SN  - 2352-5398
UR  - https://doi.org/10.2991/assehr.k.200428.061
DO  - 10.2991/assehr.k.200428.061
ID  - Zhao2020
ER  -