The Pricing Strategy for the Dual Channel Supply Chain with Pre-Sale Service

In this paper, we study a dual-channel supply chain with a retailer offering pre-sale service. We integrate the consumer utility into the dual-channel Stackelberg game model. We analyze the impact of pre-sale service and dual-channel marketing on the supply chain design and its optimal pricing decisions. We find that online direct channel improves the supply chain's profit by indirectly increasing the retailer's profits. Also, pre-sale service only helps improve the supply chain's performance within certain interval of the service level. Supply chain may not always benefit from the higher service level due to the higher costs.