Stable sales objective and commission policy in an open system

Stable sales objective and commission policy in an open system

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Article ID: iaor198870
Country: France
Volume: 21
Issue: 2
Start Page Number: 153
End Page Number: 174
Publication Date: May 1987
Journal: RAIRO Operations Research
Authors:
Abstract:

We study a firm where customers move from a buying class to another according to fixed transition probabilities. The customer return for a given class is a random variable. On a period T, we seek new customers repartition in the different classes which minimizes the variance of global return for a given expected return. We extend analysis for firms which use commercial intermediaries and determine simultaneously optimal commission policy and optimal new customers repartition.

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