Pricing and coordination of product service supply chain under an industrial internet platform environment

PurposeWith the development and application of new-generation information technology, a wave of intelligent transformations in enterprise services has emerged. As a combination of various information technologies, industrial Internet platforms are becoming the new engine for driving the intelligent transformation of enterprise services. This paper examines how enterprises address pricing and coordination issues in product–service supply chains under industrial Internet platforms.Design/methodology/approachBy building a game-theoretic model that includes a manufacturer and seller, with the manufacturer building its own industrial Internet platform, this paper analyzes the changes in service operation modes, service demand and service costs arising from the manufacturer’s service-oriented intelligent transformation.FindingsFirst, with higher cost-saving coefficients and greater sensitivity of service intelligence, both wholesale and retail product prices decline, while service prices first rise and then fall as the cost-saving coefficient increases. Second, the effects of both the cost savings coefficient and service intelligence level sensitivity on service prices are related to the cost coefficient of service intelligence transformation. Specifically, in the centralized decision-making scenario, the service intelligence level is the highest, the product price is the lowest and the supply chain node firms and systems are the most profitable. In addition, manufacturers can incentivize sellers to participate in service intelligence transformation through the “cost-sharing-fixed-transfer-payment” agreement.Originality/valueWe incorporate industrial Internet platforms into the product–service supply chain framework by modeling the transformation toward service intelligence and propose coordination mechanisms to improve system performance.