Effectiveness of Different Pricing Strategies at Reducing the Workload of Home Delivery Services

EasyChair Preprint no. 13019

Abstract

Owing to a declining birthrate, aging population, and labor shortage, the Japanese logistics industry is at risk of collapse. In particular, coming restrictions on overtime hours for truck drivers are expected to have a major effect on home delivery services. Japan’s delivery companies generally charge the same delivery fee for both face-to-face attended delivery, which may include redelivery, and unattended delivery, where the item may just be placed in front of door. In this study, we investigated whether differentiating the delivery fee by charging a premium for attended delivery or offering a discount for unattended delivery of a delivery company. We formulated a game theoretic model to consider a delivery company and users with different service preference. We then determined the conditions under which price differentiation can achieve separating equilibrium where users choose attended or unattended delivery according to their service preference. We also consider the conditions under which both the company and user select the same price differentiation strategy.

Keyphrases: Home Delivery Service, Pricing, workload reduction

@Booklet{EasyChair:13019,
  author = {Hisashi Kurata},
  title = {Effectiveness of Different Pricing Strategies at Reducing the Workload of Home Delivery Services},
  howpublished = {EasyChair Preprint no. 13019},

  year = {EasyChair, 2024}}