Research on Optimization of Compensation Strategy for Online Retailers of Fresh Agricultural Products Considering Spoilage Rate

Abstract

In the context of the rural revitalization strategy, online retail of fresh agricultural products has developed rapidly. However, the loss caused by the perishability of products and consumer dissatisfaction have become key pain points restricting the industry’s development. To balance consumer satisfaction and retailer profits, this paper aims to explore the differences in optimal pricing and profit decisions between online retailers adopting and not adopting compensation strategies in the face of product spoilage. The article constructs a mathematical model based on the spoilage rate, deriving the retailer’s expected profit functions under the “no compensation strategy” and “with compensation strategy” scenarios, respectively. It analyzes the impact of spoilage rate on pricing, compensation amount, and market demand through numerical simulation. The research findings are as follows: First, compensation strategies are not applicable in all scenarios, exhibiting a significant threshold effect of spoilage rate; Second, when the spoilage rate is below the threshold (approximately 0.69), compensation strategies can effectively increase sales and profits, but they will push up the selling price; Third, when the spoilage rate exceeds the threshold, compensation strategies instead lead to a decline in profits and shrinking sales.