Optimal pricing research with speculators and strategic consumers

With the rapid changes in demand, lots of hot-selling products are subject to inventory and production constraints in the short term, resulting in the emergence of speculators. In addition, strategic consumer's delay-buying behavior will do a significant impact on the retailer's pricing decisions and revenue. In this paper, we consider a model that the monopoly retailer with fixed inventory makes pricing decisions when facing speculators. We use the Stackelberg model to analyze the speculators and strategic consumers' behavior, then we discuss the optimal price and retailer's revenue with strategic consumers proportions, consumer's reservation price variation coefficient, purchasing probability in period 2, and get the results of retailer pricing decisions. The conclusions show that the existence of speculators is benefit for retailers under specific situations. ©, 2015, Systems Engineering Society of China. All right reserved.