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The trade old for new (TON) program is an arrangement where customers purchase new products. Under new TON policies, optimizing supply chain strategies is crucial for firms adopting the online “TON + Extended Warranty Services (EWS)” model. A dual-channel supply chain incorporating online EWS and TON services is modeled via a two-stage Stackelberg game between manufacturers and retailers under centralized and decentralized decision-making scenarios. Simulation clarifies the decision-making mechanism for the online EWS supply chain. The study finds: (1) In supply chain pricing, product wholesale, direct retail, and online retail prices positively correlate with market competition. Wholesale price, EWS price, and the old-new product price gap correlate positively with online market share, while direct retail price correlates negatively. EWS price and the old-new product price gap correlate positively with warranty duration, whereas online retail price correlates negatively. (2) Regarding supply chain demand, online product demand, EWS demand, and TON demand positively correlate with online basic market share and EWS period. (3) Concerning supply chain profits, as online market share rises, direct retailer profits fall, but online retail profits increase. Centralized decision-making generates higher total supply chain profit, which further rises with EWS duration. These insights aid firms in managing e-commerce-based product TON and EWS.

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The Optimizing of Supply Chain Strategy for Online Extended Warranty with Trade Old for New Services

  • 会议论文

  • 发表日期：

    2025年

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  • Xingjian Zhou,
  • Hongming Chen,
  • Qi Yu,
  • Xinhao Chen,
  • Yan Feng

摘要

The trade old for new (TON) program is an arrangement where customers purchase new products. Under new TON policies, optimizing supply chain strategies is crucial for firms adopting the online “TON + Extended Warranty Services (EWS)” model. A dual-channel supply chain incorporating online EWS and TON services is modeled via a two-stage Stackelberg game between manufacturers and retailers under centralized and decentralized decision-making scenarios. Simulation clarifies the decision-making mechanism for the online EWS supply chain. The study finds: (1) In supply chain pricing, product wholesale, direct retail, and online retail prices positively correlate with market competition. Wholesale price, EWS price, and the old-new product price gap correlate positively with online market share, while direct retail price correlates negatively. EWS price and the old-new product price gap correlate positively with warranty duration, whereas online retail price correlates negatively. (2) Regarding supply chain demand, online product demand, EWS demand, and TON demand positively correlate with online basic market share and EWS period. (3) Concerning supply chain profits, as online market share rises, direct retailer profits fall, but online retail profits increase. Centralized decision-making generates higher total supply chain profit, which further rises with EWS duration. These insights aid firms in managing e-commerce-based product TON and EWS.