Abstract: A dual-channel retailer’s joint pricing and lead-time decisions are studied in this paper. The dual-channel service can be described as the near-end service mode, the mid-end service mode or the far-end service mode according to the retailer's online service scope. The retailer’s optimal pricing and lead-time decisions in each mode is analyzed and profits of these modes are compared. The results show that if the delivery speed of the retailer is low, he should choose the near-end service mode. If the retailer's delivery speed is high, the decision is made between the mid-end service mode and the far-end service mode. Moreover, the optimal lead-time is reduced with the unit delivery cost or delivery speed. This is because the retailer’s service scope is reduced with the increase of delivery cost, and a fast delivery speed will also lead to the reduction of lead-time. However, the trends of price decisions with the unit delivery cost or delivery speed are quite different in these two modes. The price is non-increasing in the mid-end service mode, while the price is non-decreasing in the far-end service mode. This is because in the mid-end service mode, the retailer prefers to offer a lower price to attract more offline demand, while in the far-end service mode, the price is raised to ensure a higher marginal revenue. This research acts as an effective scientific reference and helps provide a theoretical guidance for retail enterprises.

Key words: dual-channel; price; lead-time; service pattern