Integrating Pricing and Inventory Control: Is it Worth the Effort?

Gimpl-Heersink, Lisa and Rudloff, Christian and Fleischmann, Moritz and Taudes, Alfred (2008) Integrating Pricing and Inventory Control: Is it Worth the Effort? Business Research, 1 (1). pp. 106-123. ISSN 2198-3402


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In this paper we first show that the gains achievable by integrating pricing and inventory control are usually small for classical demand functions. We then introduce reference price models and demonstrate that for this class of demand functions the benefits of integration with inventory control are substantially increased due to the price dynamics. We also provide some analytical results for this more complex model. We thus conclude that integrated pricing/inventory models could repeat the success of revenue management in practice if reference price effects are included in the demand model and the properties of this new model are better understood. (authors' abstract)

Item Type: Article
Additional Information: This research was supported by the Vienna Science and Technology Fund (WWTF) under grant "Integrated Demand and Supply Chain Management" (Call "Mathematics and ...").
Keywords: Inventory Management / Pricing / Reference Price / Stochastic Demand Model
Divisions: Departments > Informationsverarbeitung u Prozessmanag. > Produktionsmanagement > Taudes
Forschungsinstitute > Supply Chain Management
Version of the Document: Published
Variance from Published Version: None
Depositing User: Gertraud Novotny
Date Deposited: 10 Jun 2016 14:25
Last Modified: 17 Aug 2016 16:39
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