A study on pricing and delivery strategy for e-retailing systems

This study investigates the dynamics between price and lead time for an e‐retailing system in which one of its commodities is offered by two duopolistic suppliers. A Stackelberg game is formulated by considering the two suppliers as the leaders and the e‐retailer as the follower. The proposed model assists the channel members in getting an equilibrium relationship in a competitive environment. The results suggest that when a supplier chooses a shorter lead time as the competitive strategy, the other supplier should choose a lower price for counteraction, and channel members should understand the characteristics of demand before promoting their commodities.