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How to determine delivery time pricing in electronic market to increase demand and benefit is very important for the network marketing firms. This paper develops a model of lead-time-contingent pricing, in which to maximize profits is considered as the firm's objective and to achieve the required level of service is considered as major constraints. Through numerical examples, we examine the optimal pricing strategies for network marketing firms when the consumers are price sensitive or time sensitive.
Date of Conference: 21-25 Sept. 2007