Multiperiod Dynamic Pricing and Inventory Control Decisions for an Omnichannel BOPS Retailer with Reference Price Effects

Table 2

Summary of notations.

Notation	Description
Decision
pi	The omnichannel retailer’s retail price in the ith period
Ei	The ending inventory level in the ith period
Parameters
Di	The demand rate in the ith period
	The omnichannel retailer’s discounted total profit over the infinite horizon
	The omnichannel retailer’s total profit in the ith period
z	The discount factor
	The reference price effects coefficient implies the sensitivity of consumers to the gap between the reference price and the retail price. The demand is called loss neutral if , loss averse if , and loss seeking if
	The memory factor
	The valuation of the product by the consumer in the ith period, random values that follow distribution and density , and
c	The unit inventory and procurement cost
m	The unit shipping fee
t	The unit travelling cost of consumers to visit the store
s	The salvage price for a leftover unit
l	The cross-selling benefit
	The fraction of online consumers choosing to BOPS, and is the fraction of online consumers choosing to buy online directly
	The fraction of the incremental demand (brought by the omnichannel strategy) coming from the online market, and is the fraction of the incremental demand coming from offline market
k	The fraction of the market demand served under the single online channel strategy