Analysis of Optimal Variables of Return Freight Insurance Decision for Each Part of Supply Chain Based On Stackelberg Game

Authors

  • Rui Zhao
  • Mingrui Wang

DOI:

https://doi.org/10.62051/ijcsit.v3n1.22

Keywords:

Game theory, Free freight insurance model, Model decision made by seller

Abstract

Based on the theory of demand and profit function, this paper studies the effects of different return freight insurance policies on manufacturers (sellers), platform optimal price, and optimal wholesale price under the distribution model. By constructing a mathematical model under Steinkelberg game, this paper analyzes the model without freight insurance and the model with freight insurance borne by different parts of the supply chain to explore the changes of the optimal variables of each party. The results show that: with the increase of the residual value of returned goods, the optimal retail price and the optimal return volume will increase, while the optimal wholesale price and the optimal demand will decrease. Under the model of freight insurance shared by the platform and the manufacturer, with the increase of freight insurance shared by the manufacturer and the platform, the optimal selling price increases, the optimal demand and the optimal return volume decrease, and when the cost of freight insurance borne by the manufacturer exceeds half, the wholesale price increases. Under the model of buyer bearing freight insurance, when consumers have high price sensitivity, the higher the cost of consumer bearing freight insurance, the lower the maximum selling price.

References

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Published

15-06-2024

Issue

Section

Articles

How to Cite

Zhao, R., & Wang, M. (2024). Analysis of Optimal Variables of Return Freight Insurance Decision for Each Part of Supply Chain Based On Stackelberg Game. International Journal of Computer Science and Information Technology, 3(1), 173-181. https://doi.org/10.62051/ijcsit.v3n1.22

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