Speaker: Mahya Hemmati, Visiting PhD student

Title: Pricing and sourcing strategies of complementary products under supply disruption: bundling or unbundling? 

Abstract: Having a significant impact on supply chain profitability, supply disruption is a crucial issue faced by many firms. Effective mitigation of supply disruption risk calls for cross-functional coordination in a business context. For instance, while an appropriate sourcing strategy can reduce the risk of supply discontinuity, a carefully devised marketing strategy can reduce the negative impacts of supply disruption on profitability. In this study, we integrate the sourcing and marketing decisions of a profit-maximizing retailer under supply disruption risk. In particular, we consider a retailer who employs a dual sourcing strategy for complementary products that are sold either individually or as a bundle. It is shown how disruption influences retailer’s optimal decisions and profitability under separate sale, pure bundling, and mixed bundling strategies.

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Organisers: Sanne Wøhlk and Marcel Turkensteen