Supply chain partners ’ decisions with heterogeneous marketing efforts considering consumer’s perception of quality

Abstract

Consumers’ perceived quality of products reflects their psychological estimations on product quality, which directly affected by the real product quality by manufacturer provided and the appearance of package that conducted by the retailer. This study explores how the consumer quality preference influents the supply chain decisions. Thereafter, two situations where manufacturer and retailer respectively dominates the supply chain are considered to obtain the analytical solutions of optimal product quality, wholesale price, packaging investment and retail price. Finally, the impact of consumer perception coefficient on product quality, packaging investment, and pricing strategy is investigated, and some management enlightenment are obtained.