School of Economics and Management, University of Science and Technology Beijing
Advance selling enables manufacturer to obtain market demand information in advance. However, due to the uncertainty of consumer product valuation, manufacturer are also faced with the risk of a large number of product returns. Using newsvendor model and consumer expected utility theory, this paper considered the influence of reference price effect on consumer purchase behavior and manufacturer "s advance selling pricing strategy, the expected profit model under the three strategies of single advance selling, advance selling return not for sale and advance selling return for sale were constructed, then the optimal production and the value range of return compensation price under different return strategies were obtained. Finally, these models were compared and analyzed. It is found that there was a critical threshold value of return compensation price in the strategy of high price advance selling and low price advance selling. The ratio of informed consumers with reference price effect determined the pricing strategy of manufacturers in the advance selling period, and under a low price pre-sale strategy, the pre-sale price decreased with the increase of return compensation price and reference price coefficient.