Notice of Removal: Dual sales channel management with service competition

It present a strategic analysis of manufacturer-retailer interaction in a dual channel setting and an analytical model that incorporates the key trade-offs regarding the channels. we study how a manufacturer can effectively manage his direct online channel and an independent retail channel when the channels compete in providing better service to end consumers. We suggest dual channel strategies to the manufacturer by integrating a consumer channel choice model with the manufacturer and the retailer's operational decisions. The manufacturer earns a higher profit margin in the direct channel. whereas, he can share the inventory risk with the retailer in the retail channel. In the model, the strategic interaction between the manufacturer and the retailer is driven by a consumer channel choice model that considers the consumers' willingness-to-wait and product availability concerns as well as the relative convenience of shopping from the channels. The analysis illustrates how the manufacturer can use the dual channel structure to his advantage. We characterize the manufacturer's optimal wholesale price when contracting with the retailer, and the resulting channel mix. The key features of the model include availability-based service competition between the channels, and a detailed consumer channel choice model based on the service levels at each channel. The model enables us to identify various insights into dual channel management. It address availability-based service competition in a dual channel setting, focusing on the strategic interaction between the manufacturer and the retailer. In addition, we contribute to the literature by developing a detailed consumer channel choice model to drive the manufacturer's and the retailer's operational decisions.