Adding new stores close to incumbent franchisees, or franchise encroachment, has been a contentious issue in the marketplace. Prior studies on the encroachment effect focus mainly on the store-level cannibalization, lacking the understanding of customer-level post-encroachment outcomes. The authors investigate individual-level transaction data from a cluster of bakery franchise stores to quantify the franchise encroachment effect at store- and individual-levels with store and customer heterogeneity. Our results show that incumbents experience a decrease in sales, and the extent of the lost sales is attenuated by the distance between incumbent and new stores and the size of incumbents’ product assortment. The individual-level analysis reveals that three customer segments exhibit different post-encroachment shopping behaviors: (1) patronizing incumbents only, (2) patronizing both incumbent and new stores, and (3) completely switching to new stores. While the second segment increases the post-encroachment overall spending, the third segment contributes to both cannibalization to incumbents and higher sales to the franchisor. Our findings offer managerial implications of how to manage franchise encroachment with context-dependency and customer segmentation in terms of maximizing overall franchise performance.

This paper addresses the maintenance optimization problem in multi-component systems in which parts are connected in series, carrying out several missions interspersed with scheduled finite breaks. Due to limited time or resources, maintenance actions can be only carried out on a limited set of components. The decision maker then has to decide which components to maintain to ensure a pre-specified performance level during next mission. Most of the existing models in the literature usually assume only one system and enough spare parts. However, there are situations in which maintenance is required for multiple systems of the same type. To overcome this restrictive assumption, this study optimizes the maintenance problem considering the lack of repair parts and cannibalism for many identical systems. This study presents two optimization models with different objectives to solve the problem and analyzes the results so that the decision maker can decide. The results of this study are expected to be used for the maintenance of multiple systems of the same type, such as swarm drones.

Product launch is perhaps the most important but risky phase in new product development process (Calantone & Montoya-Weiss, 1993). Product management at the launch phase aims to gain market acceptance, which, in turn, may maximize the chances of profitability (Guiltinan, 1999). One of the hidden, but real, threats for the vast majority of new product launches into a market is cannibalization, which refers to the process by which a new product gains a portion of its sales by diverting sales from an existing product (Harvey & Kerin, 1979;Lomax, Hammond, East, and Clemente, 1997; Traylor, 1986). High-technology markets are characterized by uncertainties that derive from market, technology, and competitive factors (Moriarty & Kosnik, 1989). Different information processing patterns among buyers are likely to emerge in high-technology markets (Capon and Glazer, 1987; Glazer, 1991). Accordingly, marketing strategies and tools are required to adapt to market environments. In response to environmental complexity and turbulence, marketers of high-tech products usually resort to marketing communications to assuage customers’ fear and doubt involved in product adoption (Lee and O’Connor, 2003). Such high-tech marketing practices, in a sense, illuminate signaling theory logic to mitigate uncertainty (Gulati and Higgins, 2003). Drawing on signaling theory, this research is to explore the circumstances under which launch tactics may result in salient product cannibalization. It is proposed that the cannibalization of product launch varies with the interactions between launch tactics and organizational/market factors. The findings of this research indicate that the cannibalization effect of price similarity will be greater for a launching firm possessing great product category strength. The cannibalization effects of preannouncing timing and price similarity tend to be greater in a highly competitive market context, as opposed to a low competitive context. Nevertheless, relative communication effort in support of product launch results in smaller cannibalization under a highly competitive condition. Product cannibalization derived by earlier preannouncements will become greater in a highly technologically turbulent market. This research contributes to the marketing and product management literature in two main respects. First, it represents an initial effort to empirically test the link between tactics in support of product launch and product cannibalization under different firm and market conditions. Second, we advance understanding of the cannibalization effects incurred by launch tactics by adopting a signaling approach. The fit between marketing strategy and its context has significant implications for new product performance, which should be captured in terms of the potential cannibalization between a new product and other products within the same firm, in addition to its sales and profitability. The findings may also offer guidelines for managing launch tactics. To make right decisions on developing appropriate tactics, the firms must accurately evaluate the firm and market characteristics and, simultaneously, take into account the amount of cannibalization caused by different tactics.

In this paper considered is the provisioning quantity determination problem of consumable concurrent spare parts (CSP) of a new equipment system to minimize the procurement cost under the operational availability constraint. When a part fails, repair of t

Considered is the concurrent spare part(CSP) requirements problem of new equipment system. In the considered system, when a part fails, the part cannot be repaired and should be replaced. In addition, cannibalization is allowed. It is assumed that the fai