Title: Coordination mechanism of logistic service supply chain: a perspective of presale sinking and risk aversion

Authors: Weihua Liu; Shuang Wei; Xinran Shen; Yanjie Liang

Addresses: College of Management and Economics, Tianjin University, No. 92, Weijin Road, Nankai District, Tianjin, 300072, China ' College of Management and Economics, Tianjin University, No. 92, Weijin Road, Nankai District, Tianjin, 300072, China ' College of Management and Economics, Tianjin University, No. 92, Weijin Road, Nankai District, Tianjin, 300072, China ' College of Management and Economics, Tianjin University, No. 92, Weijin Road, Nankai District, Tianjin, 300072, China

Abstract: Many retailers are implementing presale strategies with logistics integrator for presale sinking, and pre-distributing products to sinking sites in advance, to conveniently and efficiently deliver to customers. This paper explores the influence of presale strategies and risk-averse behaviour on decisions and profits of the logistics integrator in the context of demand updating. The paper finds that when retailer adopts presale strategies with a larger discount, all potential customers will pre-order in the first period; otherwise, all potential customers will buy in the second period. These presale strategies can increase the pre-distribution volume and utility of the logistics integrator. While the risk-averse behaviour leads to a decrease in the pre-delivery volume, the utility of logistics integrator increases. Under these presale strategies, high discounts can eliminate the impact of uncertain demand risk, while presale strategies with low discounts cannot. [Submitted: 24 October 2021; Accepted: 3 February 2022]

Keywords: presale sinking; risk aversion; logistics pre-distribution; conditional value-at-risk; CVaR.

DOI: 10.1504/EJIE.2023.129459

European Journal of Industrial Engineering, 2023 Vol.17 No.2, pp.310 - 341

Received: 24 Oct 2021
Accepted: 03 Feb 2022
Published online: 09 Mar 2023 *

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