Channel Pricing Strategy under Manufacturer Collusion Mode

Manufacturer collusion is a method for improving profit, it will influence the conduct of channel pricing. To the conventional channel structure made of many manufacturers and many retailers, the paper discusses the influence of manufacturer collusion on channel pricing decision under three kinds of channel price leadership. The research results are as follows. Under manufacturer Stackelberg leadership, manufacturer collusion has no impact on channel pricing decision. Under vertical Nash or retailer Stackelberg leadership, manufacturer collusion can improve the manufacturer's profit level and reduce the retailer's profit level, but whether the wholesale price and retailing pricing and retailer margin will increase lies on the level of manufacturing costs. Comparing to other channel price leaderships, the manufacturer's profit and retailer's profit under manufacturer Stackelberg leadership are the highest under manufacturer collusion, but the manufacturer's profit level under retailer Stackelberg leadership. Under manufacturer collusion, channel pricing decision under vertical Nash or retailer Stackelberg leadership is not influence by product differentiation, but the manufacturer will get more profit if the product differentiation is bigger under manufacturer Stackelberg leadership. Under whichever channel power structure, the retailer will get more profit if the retailer differentiation is bigger.