Volume 10, Issue 4 (2021)                   ORMR 2021, 10(4): 81-102 | Back to browse issues page

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Dehghan Nayeri M, Azar A, Hadad R. An Optimization Model for Perishable Products Pricing (Case of OK chain store). ORMR 2021; 10 (4) :81-102
URL: http://ormr.modares.ac.ir/article-28-51051-en.html
An Optimization Model for Perishable Products Pricing (Case of OK chain store)
Mahmoud Dehghan Nayeri 1, Adel Azar2 , Roghayeh Hadad3
1- Management and Economics Faculty, Tarbiat Modares University , mdnayeri@modares.ac.ir
2- Management and Economics Faculty, Tarbiat Modares University
3- Management and Economics Faculty, Tarbit Modares University
Abstract:   (2786 Views)
Pricing as a basis of revenue management can ensure the maximum expected profit of any business if managed effectively. In competitive markets of perishable products, the prices are vitally set in a dynamic manner according to the product life cycle by different discounts or price recovery strategies. Consequently this study develops an optimization model on dynamic pricing with the aim of maximizing revenue and diminishing the related costs. Considering the product freshness and its impact on demand, the model determines the pricing policy including the increasing or decreasing rate of the price during the sales horizon consist of several time periods equal to the product life cycle. Moreover, replenishment and inventory costs are incorporated in defining the pricing policy for each period. The proposed model implemented for the OK chain store, which results in a suitable pricing policy (decreasing) in line with the revenue increase for the meat and vegetable products of the whole store.
Keywords: Revenue Management, Dynamic Pricing, Perishable Products, Inventory Replenishment.
Full-Text [PDF 1845 kb]   (1865 Downloads)    
Subject: Organizational Behavior and Human Resource Management
Received: 2021/03/19 | Accepted: 2021/03/17 | Published: 2021/03/17
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