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Optimal Pricing Strategies and Inventory Management for Fresh Food Products in Sustainable Cold Chain: Analytical Modeling with Korean Market Validation

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  • Sunghee Lee

    (Department of Business Administration, Hoseo University, 12 Hoseodae-gil, Dongnam-gu, Cheonan-si 31066, Chungcheongnam-do, Republic of Korea)

  • Jinsoo Park

    (Department of Business Administration, Jeonju University, 303 Cheonjam-ro, Wansan-gu, Jeonju-si 55069, Jeonbuk-do, Republic of Korea)

Abstract

With rising consumer concerns regarding food safety, cold chain management—which preserves product freshness through low-temperature distribution—has emerged as a critical competitive factor for retailers. This study examines how retail firms can manage quality deterioration over time to maximize profits, with a focus on pricing strategies and discard rates. Through game-theoretic modeling and empirical data analysis of milk products, we find that while individual items exhibit no consistent pattern, bundled fresh food items demonstrate an inverted U-shaped relationship between discount rates and profits, indicating an optimal discount level. Furthermore, we identify a U-shaped relationship between order quantity and disposal rate, highlighting the importance of determining optimal inventory levels to minimize waste and maximize efficiency for a sustainable competitiveness.

Suggested Citation

  • Sunghee Lee & Jinsoo Park, 2025. "Optimal Pricing Strategies and Inventory Management for Fresh Food Products in Sustainable Cold Chain: Analytical Modeling with Korean Market Validation," Sustainability, MDPI, vol. 17(17), pages 1-24, August.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:17:p:7680-:d:1732853
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