Publication Details

Category Text Publication
Reference Category Preprints
DOI 10.2139/ssrn.4217491
Title (Primary) How customer choice shapes network structure over multiple periods: Model and solution
Author Esmaeili Aliabadi, D. ORCID logo ; van Woensel, T.
Source Titel SSRN
Year 2022
Language englisch
Topic T5 Future Landscapes
Abstract The recent pandemic has led to tectonic changes in the business world. Some brands considered moving towards closing stores and offering pure online retailing by adding fulfilment centres to their supply chains, while others opened new stores as they found consumers craving to return to stores. This has made an unprecedented shift in retail business models and introduced a set of new challenges to retailers. One of these problems is to devise plans to close some stores and open new ones over a number of periods. In this paper, we deal with the problem of finding a timed reconfiguration plan of a retailer's network as a bi-level optimisation model with integer variables on both levels. On the upper level, the firm attempts to maximise the total profit over the planning horizon and on the lower level, customers try to find solutions to minimise the total incurred cost given their utility functions. To solve the proposed model, we develop a sequential bargaining strategy, which assumes the firm has partial information about customers' utility functions. Using a set of test problems, we demonstrate that the firm and customers can reach equilibrium (i.e., a sustainable agreement) using the developed strategy while not sharing sensitive information.
Persistent UFZ Identifier
Esmaeili Aliabadi, D., van Woensel, T. (2022):
How customer choice shapes network structure over multiple periods: Model and solution
SSRN 10.2139/ssrn.4217491