Optimal Marketing Strategy for a Manufacturer Considering Product Leasing and Lost Sales
Wu Yan-liang
Zhang Ren-qian
Fang Wei-guo
Abstract：Product leasing service was studied considering the servitization conducted by many manufactur-ing enterprises aiming at identifying the optimal selling period and the best proportion between two kinds of product, i.e., the selling-product and the leasing-product.Furthermore, a model maximizing the total profit considering the inventory holding cost, backorder cost, product depreciation expenses, etc is formu-lated.During the derivation of the best solution, some important properties can be obtained:there always exists the optimal proportion between the amount of selling-product and leasing-product given the selling period in order to maximize the total profit, and vice versa.Results of numerical experiments and parame-ter sensitivity analysis shed light on management: manufacturer′s optical marketing strategies are affected by demand rate of leasing-product and price of selling-product.And also, manufacturer should keep a rea-sonable amount of leasing product when panning to carry out the leasing service.
Keywords：product leasinglost salesmarketing strategymanufacturing servitization
Publication Date：2015-01-01
Online Publishing Date：2025-08-15(First online date of this platform, not the publication date of the document)
Pages：10( 41-50 )