A Critical-Level Dynamic Pricing Mechanism for Improving Supply Chain Inventory Policies With Multiple Types of Customers: An Integration of Rationing Policy and Dynamic Pricing

In today’s highly dynamic and competitive environment, an effective and practical inventory policy is critical for every supply chain and can dramatically affect its performance. When a supply chain faces multiple types of customers with different characteristics, management encounters even more challenges in making decisions about inventory policies. By integrating inventory rationing policies and dynamic pricing strategies, this study proposes a critical-level dynamic pricing (CLDP) mechanism associated with inventory ordering policies to address these challenges. Furthermore, to demonstrate the implementation and evaluate the effectiveness of the proposed policy, we develop a simulation model with the CLDP mechanism and apply it to a specific numerical case. The results show that the proposed inventory policy improves the total net profit by 12.58%. Finally, the conclusions and future research topics are discussed.