Dynamic Pricing in Supply Chains: A cumulative approach towards Optimal Pricing Solution

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ACKNOWLEDGEMENT

I would take this opportunity to thank my research supervisor, family and friends for their support and guidance without which this research would not have been possible

DECLARATION

I, [type your full first names and surname here], declare that the contents of this dissertation/thesis represent my own unaided work, and that the dissertation/thesis has not previously been submitted for academic examination towards any qualification. Furthermore, it represents my own opinions and not necessarily those of the University.

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ABSTRACT

The paper undertaken symbolizes the pertaining issues and concerns that were identified and undertaken for the purpose and objective of identifying the best and most effective outcomes that we see today. It must be understood and comprehended that individuals tend to make way for undertaking the best and most cost-effective pricing models and incorporate them into the business for the lowest cost. This is a particular and genuine requirement in the case of supply chain management, as delivery and dispatch of commodities and goods need to be delivered and dispatched at the right destination, in the right condition and at the right time. To obtain higher supply chain value, the supplier and the retailer should cooperatively determine the optimal entry time. This paper proposes a two-stage dynamic optimization model by using a real option approach and then performs the sensitivity analyses for the option value and the investment threshold. The impacts of some critical factors, including the growth rate and the volatility of demand shock, sunk cost, and relating operational costs (cost rates, fix costs, holding costs of inventory, and shipping costs), are investigated. The main focus of the research is Dynamic Pricing in Supply Chains and. The research also analyzes many aspects of Optimal Pricing Solution and tries to gauge its effect on automobile industry and perishable foods.

Table of Contents

ACKNOWLEDGEMENT2

DECLARATION3

ABSTRACT4

CHAPTER 1: INTRODUCTION1

Introduction to the concept1

Dynamic Pricing defined1

Issues regarding Dynamic Pricing4

Supply Chain Management5

Customer Demand Behavior6

US Light Vehicle sales data7

CHAPTER 2: LITERATURE REVIEW9

Explanation and Calculation for the values of a, V(no), the values of Standard Newsboy model and Percentage Improvement10

Data Analysis12

Mathematical explanation of the graph of expected profits vs. Discount values17

Regression model for Overlapping Sales19

CHAPTER 3: METHODOLOGY28

Research Design28

Literature Search Criteria28

Reliability29

Validity29

CHAPTER 4: ANALYTICAL RESULTS AND SENSITIVITY ANALYSIS30

CHAPTER 5: CONCLUSIONS AND FUTURE RESEARCH37

Further Research38

REFERENCES38

CHAPTER 1: INTRODUCTION

Introduction to the concept

In order to imply the kind of work that has been done for maintaining a cost-effective business strongly focused and concentrated on resource utilization, a brief understanding of the model, incorporated within this paper and towards the areas of business needs to be analyzed and evaluated at length.

Dynamic Pricing defined

Dynamic pricing symbolizes and implies the phenomenon where customized offerings and exchanges are being made between customers and the company, varying vastly and significantly from one customer to another. Each customer - current or potential - is being entertained and catered according to their collective (as a company) or individual (as a sole owner or single customer) requirement, who shall make way to maintain corporate relations ...