ABSTRACT
Retailers engage in collusive behavior to jointly obtain higher profits leading to lower profits for the manufacturers as well as higher prices for customers. The research papers related to this chapter are primarily the works on the WPS of the manufacturer or upstream supply chain member supplying products to downstream competing retailers. The chapter reports the equilibrium analysis of the collusion game for Equal-WPS and Dis-WPS. Different numerical experiments were conducted, and a common pattern of results was obtained across the different numerical sets. The chapter has several implications for practicing managers representing both the manufacturing sector and retailing sector. Game-theoretic models have been developed corresponding to two wholesale pricing strategies of the manufacturer, i.e., Equal Wholesale Pricing Strategy, and Discriminatory Wholesale Pricing Strategy. The gametheoretic models are compared through a numerical example capturing the difference between product categories based on their product-web fit.
