Authors
Dung T Mai, Tieming Liu, Michael DS Morris, Shuzhen Sun
Publication date
2017/1/16
Journal
European Journal of Operational Research
Volume
256
Issue
2
Pages
524-532
Publisher
North-Holland
Description
In the past two decades, many store-brand products have been introduced by their retailers as having low-cost alternatives to existing brands. However, many store-brand products are perceived with lower quality because their manufacturers do not own the brands. In this paper, we investigate using extended warranties to coordinate the quality decisions of store-brand products. We investigate three extended warranty contracts for the amount of revenue transferred from the retailer to the manufacturer: fixed fee, proportional sharing, and manufacturer direct. Under the fixed fee structure, the transferred amount is pre-negotiated, fixed, and independent of the price of the extended warranty; under the proportional sharing structure, the transferred amount is proportional to the price of the extended warranty; under the manufacturer-direct structure, the retailer let the manufacturer decide the price and collect all the …
Total citations
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Scholar articles
DT Mai, T Liu, MDS Morris, S Sun - European Journal of Operational Research, 2017