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Pricing Decisions in a Fuzzy Supply Chain System Considering Different Duopolistic Retailers’ Competitive Behavior

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Abstract

This paper characterizes the pricing decisions in a two-echelon supply chain composed of one manufacturer and two retailers. A Stackelberg structure is supposed between the two echelons with a manufacturer acting as the leader and two retailers acting as followers in the supply chain. Specifically, both customer demand and manufacturing cost of products are represented as triangular fuzzy variables, and expected value models are developed to discuss the pricing decisions, and the influence of three different types of competitive behavior of the two retailers, namely Stackelberg (Model S), Bertrand (Model B) and Collusion (Model C), using the global cooperation model (Model G) as a reference. Further, a numerical experiment is conducted to illustrate that different types of competitive behavior have different effects on the optimal profits of chain members, where the maximal expected profit of the supply chain system and the manufacturer are all positively associated with the fuzzy degrees of parameters in all three situations, while those of the retailers are associated negatively.

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Notes

  1. Type-1 fuzzy numbers are used to solve the general problem of uncertainty, while type-2 fuzzy numbers are used to solve complex or high-order uncertainties [36, 37].

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Acknowledgements

This work is supported by the National Natural Science Foundation of China (Grant No. 71672071).

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Authors and Affiliations

  1. School of Management, Huazhong University of Science and Technology, Wuhan, 430074, China

    Qin Zhong & Zongjun Wang

  2. College of Economics and Management, Huazhong Agricultural University, Wuhan, 430070, China

    Xianpei Hong

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  1. Qin Zhong
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  2. Zongjun Wang
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  3. Xianpei Hong
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Correspondence to Xianpei Hong.

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Zhong, Q., Wang, Z. & Hong, X. Pricing Decisions in a Fuzzy Supply Chain System Considering Different Duopolistic Retailers’ Competitive Behavior. Int. J. Fuzzy Syst. 20, 1592–1605 (2018). https://doi.org/10.1007/s40815-017-0437-4

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  • DOI: https://doi.org/10.1007/s40815-017-0437-4

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