Structural Analysis of "National Brand vs. Store Brand" with Stochastic Demands

10.6702/ijbi.2013.8.1.1

Masato Kotani；Ushio Sumita

Store brand ； national brand ； stochastic demand ； optimal order quantities ； optimal price

International Journal of Business and Information

8卷1期（2013 / 06 / 01）

1 - 33

英文

Recently, the entry of store brands (SBs) against national brands (NBs) has been drawing much attention from researchers and practitioners, since SBs may structurally change how market players compete. Although there is an extensive literature on analyzing, from various perspectives, the structural issues surrounding store brands vs. national brands, the literature is rather limited in that research papers are either empirical or analytical, but only with deterministic demands. The purpose of this paper is to fill this gap by incorporating stochastic demands for both national brands and a store brand. As for the classical news boy problem, this paper treats explicitly the residual value applied to the order quantity beyond the actual demand and the opportunity loss arising from the shortage of the order quantity against the actual demand. From the point of view of a retail chain store, a computational foundation is established for evaluating the optimal order quantities for national brands and a store brand, as well as the optimal price of the store brand.

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