Response surface methodology of dual-channel green supply-chain pricing model by considering uncertainty

Abstract

Companies apply dual-channel supply-chain (DCSC) by allocating online facilities without leaving conventional retailers. As a result, carbon emissions from production activities have increased in the company structure. Nowadays, DCSC researchers have a tendency to set their models in deterministic settings. These models cannot cope with the structure complexity. This research used Response Surface Methodology to analyse uncertainty in DCSC. The decision variables were the retailers and online prices, while the responses were price channel sensitivities (βo and βr), cross-channel sensitivities (γor and γro), profit estimation, and carbon emission estimation. In illustrating the real-world competition under oligopoly games, the optimisation phase used nonlinear programming under cooperative and non-cooperative scenarios. The result showed that in each channel, price combination had a significant effect on the response variables. Price differences on each channel could confirm the changes of customer preference channel. This study finds that the application of a response surface methodology can describe the significance of price to the DCSC system.

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