Work

Dynamic Pricing for Perishable Products with Control of Cancellation Demands and Strategic Consumer

Year: 2016

Type: article

Abstract: In this paper, we consider the case that the consumers may cancel their reservations during the booking period so that consumers are divided into two parts: cancellation request and booking request. Simultaneously, we assume that consumers act strategically in booking products. Upon receiving the request, the firm has to decide whether to accept the cancellation request and what fees to charge the booking request in the presence of strategic consumers. We propose optimal price strategy and show the effectiveness of the decision models. We also obtain the optimal control of cancellation demands policy which is achieved by the number of remaining inventory. Numerical experiments are presented to explore the effect of various parameters on the performance of optimal strategy.

Source: Open Journal of Social Sciences

DOI: 10.4236/jss.2016.47001

Authors: Hao Li, Meirong Tan, Liuxin Zou

Institution: Chongqing Jiaotong University

Language: English

Topic: Supply Chain and Inventory Management

Subfield: Management Science and Operations Research

Field: Decision Sciences

Domain: Social Sciences

Open Access status: diamond

Funder: National Natural Science Foundation of China

Award: 面向策略乘客行为的航空客运动态定价策略及应对机制研究