Evaluation of O2O E-tailers with Threshold Policy and Drop Shipping Option Under Multiperiod Environments

Abstract

With the rapid development of the Internet, e-commerce is becoming more and more popular in China, especially the widespread adoption of the mobile Internet. Many people begin to shopping via mobile phones. Under such circumstances, many traditional retailers and traditional e-tailers have started to open online or offline channel to become O2O e-tailers, but they have significant difference. This paper builds two different O2O e-tailer models based on this difference, the first types of O2O e-tailer, which was originally a traditional retailer, is still mainly focus on the offline channel, and the other type of O2O e-tailer, which was originally a traditional e-tailer, is also mainly serving the online channel. For these two types of O2O e-tailers, this paper studies the positive effect of O2O mode and drop shipping option on them through simulation approach, and examines the influence of customer composition changes on the two types of O2O e-tailers.