Making Optimal Decisions of Assembly Products in Supply Chain

Abstract

<p>The strategic pricing decisions of assembly products in assembly products supply chain are studied in this paper. Firstly, a two-stage assembly products supply chain model is developed. By building Nash game model, the Nash equilibrium solution of pricing strategy of supplier and assemblers is obtained. Next, a union decision model is built to analyze the optimal combination pricing strategy of assembly products, and the relationship between the optimal strategies is established. The law of the changing in combination pricing strategy, assemblers' profits and supplier's profit along with the variety of some characteristics has been investigated by using numerical simulation. The results are consistent with economics principles.</p>