Ann Oper Res DOI 10.1007/s10479-017-2632-y GAME THEORY AND OPTIMIZATION Bundle pricing strategies for two complementary products with different channel powers Raghu Nandan Giri 1 · Shyamal Kumar Mondal 1 · Manoranjan Maiti 1 © Springer Science+Business Media, LLC 2017 Abstract In this paper, we consider a duopoly market where two manufacturers separately produce and sell two complementary products through a common retailer as a leader–follower movement. The competition has been studied in two-echelon supply chain system and all produced products are sold by the retailer with individual product prices or with pure products’ bundling price in the non-cooperative market. The demand of each product linearly depends on prices of these two products as per their nature. Here, model for two different cases (without and with pure products’ bundling) are developed mathematically to maximize the profit of each participant of the supply chain and then corresponding optimal pricing strategies are worked out for the manufacturers and retailer. It is shown that supply chain profit for the pure bundling is better than the profit when products are sold at individual prices. Finally, the model is illustrated with numerical data to study the effects of models’ parameters in the pricing strategies and some marketing decisions are explored. Keywords Supply chain management · Complementary products · Products bundle · Stackelberg game · Pricing strategy 1 Introduction During the last decade, many researchers have investigated integrated business activities of two complementary products in duopoly market like supply chain management in which relationship between channel members(manufacturer, distributor, supplier, retailer, buyer, B Raghu Nandan Giri raghunandan.giri86@gmail.com Shyamal Kumar Mondal shyamal_260180@yahoo.co.in Manoranjan Maiti mmaiti2005@yahoo.co.in 1 Department of Applied Mathematics with Oceanology and Computer Programming, Vidyasagar University, Midnapore 721102, India 123