Dynamic pricing and ordering decisions by a monopolist

Article Abstract:

The dynamics of decision making relating to pricing and ordering in a monopolistic retail environment is examined. Focus is placed on the market value fluctuations and inventory decay of the product throughout an inventory cycle. These two factors, value drop and wastage, create pronounced changes in optimal pricing policies and the profitability of products. Variations in pricing depend on the interrelation of the two factors such that wastage increases dynamic costs, that subsequently increase pricing. Value drop, on the other hand, induces a drop in prices by lessening product appeal.

Management science

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Competitive strategies for two firms with asymmetric production cost structures

Article Abstract:

The problem of fluctuating demand in seasonal industries is a key issue in production planning. The accumulation of inventory is the strategy favored in situations where unstable demand exists. A production cost model, which compares the production-marketing strategies of two competing firms facing a demand surge situation, is presented. The model features two firms with asymmetric production cost structures, one operating at near capacity, and the other, significantly below capacity. The model assumes that both firms vary both price and production rate to cope with demand fluctuations.

Marketing management, Production management, Inventory control, Logistics, Seasonal industries

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